I develop content for MobiPocket reader. I also provide Customer Support to several people who use our applications.
The MobiPocket reader, v4.8 build 413 seems to be fully and completely compatible with WM2003SE. The only issues that people have with the reader is the problem setting their PIDS (the DRM stuff).
Regarding the cost of eBooks: Why shouldn't they cost as much (or more) than paperbacks?
1) All the same work that goes into producing the paperback is put into the ebook.
2) Additional costs are incurred by publishers and retailers for
a. Hosting MobiPocket Content
b. Converting the book source from the original format to something that can be parsed for the MobiPocket reader
c. Additional time it takes to make the book look presentable on the MobiPocket reader -- Adding additional code and images that may-or maynot- be in the original source material