Hi Helenching, welcome to the forum. I too read both Chinese and Japanese books and I found a site for free out-of-copyright Japanese books. It is called the Aozora Bunko at this link.
http://www.aozora.gr.jp/
The Sony cannot read MobiPocket format books. However the BeBook, which is called the 翰林in Chinese speaking countries can read many formats and languages, including Chinese and Japanese. I would be surprised if it is not available in Hong Kong. It has the same e-ink screen as the Sony. Please look at this article on the Wikipedia site:
http://en.wikipedia.org/wiki/BeBook
I myself am using the Cybook made by Bookeen. This reader is MobiPocket compatible and the books I read on my eBook reader are mainly English and French classics which I have downloaded from various sites.