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I'm almost positive you can convert .LIT into LRF, so I'll say you should go with the Sony 505. Like other readers, you can zoom in sizes (skip the 700 because of the glare). We have quite a few people on here who have a 505 with a Mac, they use Calibre to manage their device, or VMWare. As a PC owner, I can't help you with that, but I do know there is a work around. It has a bookmark function (so does the Kindle), but I personally like that it's easy to move books from the computer to the device without having to worry much about redownloading. You can also put books in collections on the 505.
You probably wouldn't go too wrong with a Kindle either, but I say the Sony because it's cheaper. I'll clarify one thing for you though, no one that I know of on here has reported being charged by Amazon for the ten cents for transfer. I didn't like that either, and they could still decide to charge people for that. The Sony is an excellent device and, with a few adjustments, could do exactly what you want it to do. I don't think you could go wrong.
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