I don't see what point breaking the DRM in the Reader itself would even have -- it's not like the Reader really has an
output mechanism. I suppose you could download the 'broken' files back to your computer, but why would anyone bother? Somebody might try it just to say they did it, but I think igorsk and porkupan have the nub of it: if somebody breaks the Connect DRM it will be done on a more versatile (not to mention powerful) piece of hardware than the Reader itself.
I just don't see that being able to (re)flash the Reader would make much difference in the matter either way.