Thanks Terence,
I am away from my PC, but cobbled together a small Cyrillic+Latin UTF8 text file (how to get it to you?). Would you be so kind to try two Cyrillic html files as well please (they are on the MobileRead forums, http://www.mobileread.com/forums/attachment.php?attachmentid=34134&d=1250153823)?
I appreciate your help very much - I was on the brink of buying the reader, and only this issue stopped me.