Some eBooks are horribly formatted. To reformat them to my personal liking I use Calibre to convert the file to an editable format (e.g. ebub to rtf). I then copy the text into one of two other applications depending on my end purpose and how much time I want to invest in the product.
Simplest is to copy the text into Apple’s “Pages” application, make my formatting edits (Headings, italics, bold type etc.) then export to ePub. From there I simply add the book to my “books” category on iTunes and I’m off and running reading the book on my iPad.
A more time consuming and thorough method is to copy the text into jEdit, a simple programming application. This method requires knowledge of HTML code at the least. I started doing this for books on my Kindle since the Amazon reader is based on the Mobipocket standard which is in turn based on the Open eBook standard using XHTML. XHTML I can do.
Anyway, as I said, I put that mangy txt into jEdit and begin adding XHTML tags to make it all pretty. I also tend to add a linkable table of contents and any maps or images in the original format of the book.
So, after I format it, what I have in an HTML or XHTML document. This is imported back into Calibre, and from there converted into whatever other format I desire (which for my purposes is either Mobi or ePub.
Thus my library looks and reads the way I want it to.