As to DRM-free books, there are quite a lot of DRM-free epubs in the Kobo store and in Google Play. And yes, you can download a local copy to your computer from both of them.
Smashwords sells only DRM-free, but they're mostly self-published.
Baen and Angry Robot are SF/fantasy publishers who sell their ebooks DRM-free on their websites.
Then there are public domain ebooks on Project Gutenberg and here on MR.
As to modifying your Kobo, you may also be interested in patching:
https://www.mobileread.com/forums/sh...d.php?t=337427