I've never used my 505 for audio books (always use my iPod for that), but the 505 will play any MP3 files, so as long as the audio book you're purchasing is in mp3 format you'll be okay.
One thing I'm not sure of (maybe someone else who's used the mp3 player on their 505 can answer) is whether it will "remember" your position in the file you're listening to. This is fairly important for audio books--especially ones that have longer files. If the player won't start back up at where you left off, it can be a pain to try and locate the position you last listened to on your book.
dordale
