After the upgrade, your reading should be able to read LRF, RTF, ePub, and PDF. I don't know about DRM'd LRF, though. However, where before lrf would load right away, it will now spend 30s or whatever (depending on the size of the book) formatting like it did for rtf books. If you change the font size, it will format again until you've formatted for each font size.
As for the cover, mine is black and all it says is Reader on the front cover edge and Sony in the center of the back.
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