I have a 505 and my husband has a 700. The 505 and the 700 handle PDF's similarly with one big difference. Both devices have the same ability to "reflow" pages to make the fonts bigger. This works fairly well for most PDFs as long as they are text based. Reflowed documents can have some funny page breaks and if they contain graphics the graphics can sometimes appear in weird places or not at all.
Now, the big difference is that the 700 also has the ability to zoom in on a page--something that the 505 does not do. This allows you to keep all the formatting the same as the original page and then you can just pan left/right and up/down to see everything on the page. This is a very useful feature for PDFS with graphics, because it actually allows you to see what the graphic is displaying. The only annoyance with this feature is that the 700 will not remember your zoom settings when you turn the page on the device--it reverts back to the original size of the PDF.
Hope this helps! If you're interested in the 700 though you'll need to grab one up--they seem to be disappearing and there are rumours that Sony has stopped production on the 700 and maybe the 505 as well. They could be working on a different reader--no one knows. If they are producing one with a larger screen (akin to the 9.7" Kindle DX) that would be much better for viewing PDFs on.
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