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It appears as though eReader requires OS3 or higher so basically almost any Palm you can buy nowadays. I'd suggest seeing if you can acquire a cheap Tungsten T via ebay as they're going cheap, and you can install most modern software too, they seem to go for about 40 UKP here (which may be slightly over your planned spend though). Other than that I don't know if eReader supports sonys custom hires or not although I guess it probably does so they may be a reasonable option, the T615 or similar (which I'd imagine would be cheap nowadays)
Hope that helps somewhat
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