Oi! That'll each me to log off early!
Okay, here's the deal, I apologize in advance 'cause it's a bit complicated
A Reader can only be authorized on a single account -- when we were out at Sony, Bob, you might remember (don't know if you saw it or not) that one of the units they showed us wouldn't authorize to the Connect Store, because it was already authorized on another account. Gave a message that basically said that: already authorized to another account, or something similar.
That much I'm quite certain about.
My understanding is that a given book can only be read on up to 6 devices (one of which must be the downloading PC). Yes you can de/authorize Readers (and PC's for that matter), but once you hit six that have been authorized for a given book (even if they've since been deauthorized) it'll balk at letting you put that book on the seventh. You'll have to call and get them to reset the device count on the books.
That's what I understood to be the way it works: 6 books at a time, with a manual 'reset' process.
I'm pretty sure I understood it correctly, but I suppose it is possible that they've changed it, though I haven't seen any indications to that effect.
A couple of
old posts that explain it a bit better.