This stuff is hard and I totally understand your pain - I'm the digital product manager over at Blurb.com (ebook!). We're primarily focused on fixed-layout epubs which ensures that the picture you laid next to the text will always stay in the same place. Reflowable epubs are technologically easier to create but the output can vary so much that it makes the author look sloppy at times. Not cool.
You can create a Blurb book and then convert it to an ebook for $1.99. We create them to Apple's strict epub standards so you can even submit it to their iBookstore. No DRM. :) (http://blurb.com)
Looking forward, I think we are going to see a larger focus on fixed-layout ebooks in the future as more tablets are created (Kindle Fire, iPad) and authors see the limitations of reflowable ebooks. I'm not knocking reflowable ebooks, but just writing a book in itself is a huge undertaking (congratulations!); trying to maintain formatting and a clean layout afterwards feels like you're being punished.
As to anyone else who has gone through ebook creation/conversion with Blurb (or elsewhere), feel free to send me a note or comment with your questions. It's rare that a HN thread directly relates to my work :)
- Nic.