I love Waterfield and have bought three laptop sleevecases from them. They are on the spendy side, but the one I bought for my Alphasmart Dana back in 2003 looks just as good as the one I bought for my new laptop last summer. (Minus the fact they've since added a nice pocket in the back).
I've found their customer service fabulous, getting back to me quickly. They emailed me a personal, rather than generic email when the product I ordered was going to be delayed in shipping, and worked really hard to get it to me by the time school started and make sure that I knew what my options were and what they could do. I love them and recommend them to anyone.
I haven't tried them for the reader case, and didn't know they had one. I would email them and ask them if it would fit the 505, as suggested, as they reply really quickly. As far as quality, I've kept my laptops and Dana in them in my backpack that wasn't always treated gently and didn't have any problems, and the Dana has an unprotected screen. The cases are really thick and sturdy. I'd try it.
Plus, I would assume with the Sleevecase, if you get the strap you could also attach the
piggyback like you can with the bigger ones, giving you a whole purse option. That would be another thing I would ask though.
Actually, I would probably ask if it fit in the sleevecase with the standard case on. Being the paranoid person I am I would be using it for an additional case, not as the only case, but all the pictures are of naked Readers.