I also use Calibre for managing my library; my Kindles are for reading only. That said, I still tend to keep 1000-2000 books on my Kindles. I'm not big on collections, though, and use searching to find the necessary book on a Kindle.
Calibre does everything I want from a library manager and I wouldn't have much use for any collections/shelves feature on my reading device. It's just not really important for me.
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