The Sony Reader doesn't have any built-in support for dictionaries, so I thought about just having a regular dictionary in the form of an ebook on the device.
Here are some ones on Project Gutenberg:
http://www.gutenberg.org/etext/673
http://www.gutenberg.org/etext/247
http://www.gutenberg.org/etext/248
All we should need to do is make an "Index" with links so that you can jump to A or B or C etc. etc. without having to manually flip through pages.
I don't have a Reader yet, but I will probably make a PDF-based ebook dictionary once I do, unless someone else does!
Sam Krupa