Stanza, the iPhone e-book reader so good that Amazon bought it, has just released v2.0, and it improves on 1.x in almost every way.

Stanza was the first good e-book reading application for the iPhone, and this release keeps it at the top of the bunch. At first glance, the new feature list looks short, but when you start to poke around you discover that the polish that has been applied to the app makes every part easier to use. First, the official list:

Tabbed navigation

This simply adds a row of buttons along the top of catalog and settings screens to help find you way around. It doesn’t apply when reading, nor should it.

Copy to Clipboard in Annotation View

This single line hides a revamped annotation engine. Sure, now you can copy chunks of text, but you can also zoom pictures, share your notes (or the copied text) via Twitter or e-mail (or Facebook, if you have to), and easily define words via online dictionary.

Sharing

You can also show off how far you are into a book via Twitter and Facebook. Lord knows why, but it is there if you want it.

Unified Setting Screen

This is partially true. Those of you who learned to navigate the labyrinthine sections of the old Stanza will not be wasting that practice. It seems that the settings are, far from being unified, still scattered all over the place.

More

Not mentioned in these notes is a new text-resizer, which actually resizes the whole page as you pinch until you are happy, and then only reformats the text when you click to confirm. If you were ever frustrated by the old way which would reformat after every pinch, and always seemed to get the size wrong, you will be very happy.

In fact, this kind of polish is what marks the 2.0 update. You can now assign custom categories to your books easily, as well as creating your own collections (think playlists for books). You can assign artwork, either by searching on the web (it is automatic) or by importing from your iPhone photo library.

Further, the online catalogs have been separated into official and unofficial, so if you have added any (ahem) third-party repositories, they are kept away from the legit stuff.

One pain, and something nobody seems to have worked out yet, is that you have to leave the application to buy anything, getting dumped into Safari to input credit card or login details. A minor point, we suppose, but it certainly stops the candy-store buying approach we’re used to with iPhone applications and music. It is probably inevitable with Stanza, though, as it supports so many different online stores.

Should you download it? If you are already a Stanza user, it’s likely you already did as soon as you heard about the update. If you’re not a Stanza user, go get it now. It’s free.

Stanza [Lexcycle]

Stanza in the App Store [iTunes]