[GeoffR]

It is the same on my Glo with firmware 3.11.0, epub hyphenation only happens with full justification.

I never noticed this before because I always use full justification, so I don't know if it has always been this way or if is was something new when the Adobe RMSDK was upgraded in firmware 3.5.0.

Unlike for kepubs, the device's built-in stylesheet doesn't set the hyphenation at all for epubs, it is the Adobe RMSDK that decides when to use hyphenation based on the book's stylesheet. Maybe someone who is still using firmware version 3.4.1 or earlier could check whether it was different in the old RMSDK.

Edit: For kepubs it is a little different: by default the hyphenation is whatever is set in the book, and if nothing is specified in the book then it defaults to no hyphenation. But if full justification is set on the device then hyphenation is turned on, overriding what is in the book.