Well, for the DRM'ed books it's to prevent you from copying large amounts of text and using it for ill purposes. Maybe it is based on agreements that they have with the publishers for copyrighted material?Amazon implements a limit as well for the Kindle, but it is a percentage rather than character limit that all highlights must total less than.
For non-DRM'ed text 200 is just too small, but 2000 was good enough and never a problem for me.
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