what is the copyright situarion with an ibook created with ibooks author? what rights does apple own ... does author retain copyright of the content?
what can apple or ibook store do with the book?
Yes, the author retains the copyright. It would be very unusual for an author or other rights holder to transfer copright to a retailer.
Apple has the right to sell copies to retail customers, who in turn are bound by the iBookStore Terms and Conditions that are spelled out on the Legal page.