In the new eReader 2.0.2 for the iPhone, the ability to download books from Manybooks and from manually-entered URLs was gone. I emailed Steve Pendergrast to ask about this, and
he said that "This change was due to a complex issue regarding the Apple terms of service that’s hard to even describe," but that a fix was in the works within a week or two.
Anyone know anything more about what this complex issue might have been?