Books.app is a simple eBook reader for the iPhone. It reads HTML and text files stored in your Media/EBooks folder, and is smart enough to enter subdirectories, if, for instance, you’ve broken a book down by chapters.

Changes:

If a file doesn’t display correctly, try a new text encoding. Text encoding is now user-overrideable in the Preferences pane.
Mark all your files as new!
Mark the current directory as new! If you’re re-reading a book, mark all its chapters as new.
Many bug fixes.

http://code.google.com/p/iphoneebooks/