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I suspect this is likely a violation of agreements, but regardless it absolutely does not produce a readable ebook

Agreements of what? I could have sworn the first sale doctrine means that I own the book, as there are for sure no EULAs that I agree to when purchasing nor opening to page 1 of a book. Copyright, for sure, but not an agreement that could be violated

I would also take issue with the "absolutely" of your assertion about OCR. For some things, yes, for crazy fonted works, no, but the devil's in the details

I believe the idea was that a publisher could have a contract with libraries in order to rent them digital copies that imposes terms against other ways of getting digital copies. (Whether that should be or is legal is a separate question that I'm not going to answer; as ever IANAL.)

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