Looks like both methods are supported:
"
Barnes & Noble is adopting Adobe® Content Server, a server software solution that copy protects eBooks downloaded to nook, mobile phone applications and other dedicated eBook reading devices that have integrated the Adobe Reader Mobile SDK.
Additionally, Adobe is integrating Barnes & Noble’s eReader social content protection technology into Adobe Content Server, Adobe Reader Mobile SDK and, eventually, into Adobe Digital Editions."
http://au.sys-con.com/node/1152144