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There are three basic (legal) sources of ebooks:
1: Device vendor's store. The books sold tend to be expensive and DRM-restricted, and also may have geographic restrictions. You usually have to buy from the store in the country where your billing address is located. If your credit card is from the UK, for instance, you would be buying from Sony's UK store. This would be pretty much your only source for bestsellers, if that's your thing.
2: Independent publishers/authors/bookstores. These tend to have fewer or no geographic restrictions and many, perhaps even most, of them are DRM-free. (by the way, the proper term is DRM-restricted, not "protected"). Smashwords is one of the more popular ones. Authors are starting to sell their backlist on their own websites, too, and other interesting things. For example, Barbara Hambly is selling stories in her discontinued (due to lack of publisher interest) worlds. Webscriptions is worth a look.
3: Public domain books. This is where Project Gutenberg, ManyBooks, Feedbooks, and MobileRead itself come in. (whatever gave you the idea that PG was a pirate site?) They have tens of thousands of books, including the bestsellers of a hundred years ago -- books that people will still be reading when today's bestselling writers are a footnote in publishing history. Of course, some people have to have what's new and trendy, but that's not all there is to life. PG is full of buried treasure.
About 75% of my e-reading comes from the public domain sites; another 10% is from Smashwords, 10% from Baen/Webscriptions, and the remaining 5% from other sources (BeWrite, BookViewCafe, authors' websites, etc.)
I love my 505, by the way. I wouldn't trade it for any other ebook reader on the market. And yes, no matter what you get, you'll want calibre to manage your library.
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