Hoo, boy, that's quite a can of worms you got there, Kilarney!
You gotta watch those reviewer reviews, they do the best they can, but because they've only got so much time to sped with each thing reviewed, they don't really give you an idea of what it's like to use a device for any length of time. You'll get a better idea of that sort of thing from a users forum. You still have to allow for individual bias, of course, but at least the experience is more in depth, and of course you can ask questions.
Yeah, Microsoft could drop .LIT altogether. But Amazon could shut down Mobi too (they own it these days), so you basically pick your bet there. But with .LIT (once you convert it out to another format) if it changes, you just can't get any
more, you've still got what you already had.
For the Chinese devices, I'd suggest you look at the forums here on them, but I suspect you've already done so. The relative lack of info (such as how to get hold of them) says something too.
The format jumble you're talking about actually has a name: it's called the Tower of e-Babel. It's a result of everyone wanting to make (and control)
the standard e-book format. Until one emerges from the fray, we're kind of stuck with a choose your bet situation on that too. I try to stick with formats that are either something 'standard' (such as RTF, HTML, etc.) or can be converted to something 'standard.' That way, whatever happens to the industry, I'm able to follow. But that does require that a body be willing to do some converting, so there's the trade off.
Personally, I'm hopeful that Digital Editions will take the top slot -- PDF almost managed it, and it's utterly unsuited to e-books. That's another can of worms, but the quick version is that PDF is designed specifically to preserve the layout of a document, while e-books inherently require that the layout be flexible to accommodate varying screen sizes -- the conflict between those two is readily apparent.
There are some tools (such as
Rasterfarian) that slice-n-dice PDF files into chunks that can be displayed on the Reader, but that's another layer of conversion involved.
I don't know of any e-ink devices that support .LIT -- I believe that Microsoft has blocked .LIT from portable devices, but I could be mistaken about that.