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Yes, but it's not all library audiobooks, just those that the audiobook publisher allows OverDrive to convert. In my library, that's less than 20% of their WMA audiobooks.
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Wow...Very interesting. I haven't counted, but I would guess that my libraries would be the opposite - 10% or less that cannot be converted. So far, have actually not run across anything I wanted to checkout that could not be put on my iTouch.
cheers