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Originally Posted by fjtorres
That appears to be the case, judging by the comments in the source report.
Nate confirmed the 5 book limit from Txtr.
The evidence supporting the bitmapped DLs is the 5 books-in-4GB limit and that ADEPT-DRM'ed ebooks can be read on it without counting as an extra authentication device. The bulkiness of the files suggests the bitmaps won't be compressed, either, so the thing is likely just feeding bitmaps from flash to the eink buffer. Or maybe just remapping the buffer to different parts of the flash memory by changing a pointer.
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That would also explain the five-book limit in a four-gig storage space and the proprietary helper app, if its having to rasterize and paginate it beforehand. By the same token you could take a pared-down Linux kernel and write a frontend based around a full-featured ePub and Mobi reader in less than two gigs, and have two leftover for actual books instead of a few rasterized clones.
That's how they get it to not count as a read device, BTW. They're not actually uploading the ebook, but a raster clone of it. Analog Loophole, anyone?
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Hmm, those are 8-bit era techniques... straight out of the Apple II. Not even up to ATARI or Commodore levels. 
The LINUX crowd should be proud: no bloat in that code! 
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I'm not sure that passing off processing from one device to another is that good of an idea.