Not that I am likely to be using Microsoft Reader any time soon but this really surprised me. It seems that Windows Mobile 5.0 breaks MS Reader on Phone Edition devices and TeleRead has the details. Microsoft’s comments about the situation:
We do support Windows Mobile Phone Edition devices. However, as noted on our web site, we have encountered a problem with some Windows Mobile 5.0 Phone Edition devices. This is due to a change in the security model adopted by some device manufacturers. We have been working on a fix and expect to deploy it shortly. We do not currently support Windows Mobile Smart Phone devices.