Currently the only material the dictionary works on is those books downloaded from the Kobo web site in their own (kePub) format; ie stuff loaded either directly from the Kobo store to the Touch OR stuff loaded on to the Touch via the Kobo Desktop.
ePubs loaded via either Adobe Digital Edition, Calibre or direct copying to the unit will not support the dictionary.
This appears to be related to the two different eBook reading applications on the Kobo; one based on Adobe Mobile Technology (for ePubs) and the other (their own code) that handles kePub materials.
We are all hoping that at a later date this limitation will disappear.
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