Fictionwise have a good selection of books for the Sony Reader in their "Multiformat" option. You can also buy any Microsoft Reader book and convert it to HTML using the "ConvertLIT" tool, from which you can easily convert to Sony format using one of the book creation tools such as BookDesigner or HTML2LRF. If you like SF/Fantasy, Baen offer a good selection free from DRM. Finally, of course, there are the free book sites such as PG, ManyBooks, Feedbooks, etc.
Lots of sources of books!