Thanks Ed, interesting.  And wow Bruce, Apple is being draconian yet again.
 Unfortunately, their sell is that the books will not become obsolete ..
presumably that is a promise to the K-12 school system that they will
upgrade for free or reasonable price.  Maybe!

However, it seems the key problem has been publishers not finding a good
model that supports the author, provides a good deal to the students (or
school/state for K-12), and satisfied the publisher's needs (greed?).

One problem with digital books is DRM.  If you give the student the bits,
then if you use DRM, its a nightmare to manage and eventually fails.  If
you give them a "reader", it depends on equally on getting that right: able
to access the media, generally in the cloud, and making it proprietary.

Some creative ideas are turning up, however.  One is a Library subscription
in the sky.  Tim OReilly has Safari books: you pay and can have N books
which you change over time as your needs change.  Schools could use this,
with the kids changing over to new library entries as they advance.

Another similar example is my son who is taking sophisticated Network
Routing classes (video and text) where he's got access to an entire
library, but at a monthly cost.

Definitely this is all new and will take years to settle.  Tablets need to
be more competitive and/or student deals on laptops have to be available.
 DRM is definitely messy and generally obnoxious .. penalizing the good guy
more than the bad, alas.  The Cloud Library means you need universal
network coverage for near-zero cost.

But with OReilly, Amazon, Apple and lots more seeing it as a huge market,
hopefully a reasonable solution will evolve.

   -- Owen
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