I am having the exact same problem. See my post - Problem Sideloading Epubs. This occurs with both the 1.9.10 and 1.9.11 firmwares. I have done four factory resets and can initially load up to 3 books which show up in my library after resetting. After that I can transfer epubs directly or using Calibre. I can see that they are in the correct Kobo directly - but they never show up in my library. After ejecting properly, the Kobo goes into an extended processing content for up to several hours and then goes into a sleep mode. When I get to Kobo to come out of sleep mode (no easy trick) the books are not in my Library. My Kobo is now freezing in sleep mode and I have to use the paperclip method to wake up. If you check this forum, you'll see that a number of people are having the same problem. Alll of the epubs that I read work well on my Sony PRS-950 ereader. I am disgusted and ready to return my Kobo which I used to like.
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