Ok, may have figured it out!
Step 1: Make sure you have a backup of your iPad ready. If you don't, go a head and back it up now.
Step 2: From your iPad, delete the book who's cover you wish to change.
Step 3: Change the cover in iTunes and drag the book back to your iPad.
Step 4: Sync your iPad.
Step 5: Restore your iPad from your previous backup.
This seems to fix the cover and, so far, is repeatable ....