The problems I have with pdf's are that they are created for one paper size, not for assorted screen sizes. There are no tablets with Letter or A4 format. In addition, the typical pdf has a lot of margins that you don't really need on a tablet (they already have "margins" around the screen). Also, pdf's don't allow you to resize the font. And yeah, I really prefer reading on a tablet instead of on a computer screen, which is why this matters.
Regarding your question, I don't know if there are any current format that handles the points I mention above in a good way. Maybe epub? I haven't gotten any epub books with advanced formatting (like tables, multiple columns, reflowing around pictures or similar), but I think it should be possible (it's basically html).
Ah, I see. I assume you use a 7" tablet? I can read pdfs for hours on my 10" Asus tablet, but if it got any smaller, it could be problematic, I'm thinking.
ePub does do what you suggest, and my Kobo reader is pretty great, for text only books, but once you add pictures it's less nice. Anything like a diagram or example picture, as many RPG products have, is a disaster. So, while it's great for reading novels and such, I wouldn't want to use it to read an RPG.
Tier-targeted releases, a la BECMI?
I definitly want a pdf, but book is more important to me. It's the time where I peel myself away from the computer, turn on my radio/record player, get out pencils pens etc, and sit down at the table with a cool drink and start planning / playing the game. It's my free time away from the computer, and it's valuable to me.