A related question you did not ask is "What format is best for FBReader?". I started using Plucker, but have recently switched to MobiPocket which I still think is best for FBReader on a 800x480 screen. An alternative is .LIT exploded to .OEBZIP, which is good for "secure" e-books, and generally gives larger images than MobiPocket (which can be a disadvantage on the 770 if the images are too large for the screen).

Books I have used as examples include Ring of Fire:
http://www.webscription.net/p-352-ring-of-fire.aspx
from Baen's Free Library. This is good (e.g. as MobiPocket) because it is a collection of short stories navigable via its TOC and because there is an embedded image in the last short story. The very best examples are probably recent SciFi "magazines", such as Jim Baen's Universe or Grantville Gazette. These have extensive color illustrations which work very well in MobiPocket format on a 770. However, they are not free as e-books.

Another source of manually formatted public domain MobiPocket books is MobileRead at: http://www.mobileread.com/forums/forumdisplay.php?f=128