Quote:
Originally Posted by WT Sharpe
What's the difference (said the clueless)? 
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Using that terminology:
Reverse engineered means that the decryption code has been examined and the source of the encryption key has been found, and the algorithms used to decrypt the ebook. Then it's just a question of using the known encryption key with the known algorithms to remove the encryption permanently.
Cracked would mean that the encryption algorithm is known, but the key is either too short, or there's some flaw in the encryption scheme, so that the ebook can be decrypted without knowing how the key is normally obtained.
With the former, knowledge of the key is essential. Without it, even though the algorithm is known, the encryption cannot be removed.
With the latter, the key either isn't needed, or can be discovered by an exhaustive search in a reasonable time.
Advances in computer power mean that several encryption schemes are now cracked - one example being the old WEP encryption on Wifi. And closer to home, old Mobipocket ebooks had 8 character encryption keys with a limited character set, and even on a modest home computer can be exhaustively searched in a couple of weeks.