What's happening is that when you zoom in on a PDF, it goes into "reflow" mode, where it tries to display the text, basically at the expense of any formatting!
Taking a step back, the question is why you're needing to reflow the PDFs - PDF's only work well if created for the page size of the reading medium, which by default will probably be the A4/Letter sheet of paper. If you can instead target the much smaller size of the eInk device screen, you'll have a much better looking book.
Another option to try would be to use Calibre's lit2lrf & rtf2lrf conversions (either via the GUI or the command-line) for the LIT sources and DOCs saved as RTF respectively. (Or just try saving the Word docs as RTF & trying them directly on the device.)
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