I don't have a Sony to try, but I'm the author of the ePUB example.
I'm pretty sure the problem is that the reader interprets "line-height: 0.75" by lowering the top "border", while browsers typically raise the whole "block" (the drop cap in this case).
I don't claim to be a CSS expert, far from it... I'm not even sure what the correct behaviour could be. Maybe I should add a "vertical-align: top" property? Could you try it?
What I'm sure it's doing wrong is rendering the "I - The Birth of the Prince and the Pauper" line, it should be ignored in the text flow (and, ideally, displayed as a page header from the next page).
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