Having spent a couple of hours with this last night, I'm really wondering if the whole goal isn't to remove control of the ebook library from the user.
First, once you move your books over to iBooks, you lose the ability to move back to iTunes, as the "Books" section totally disappears. Second, the folder with your epub and PDF file is nowhere to be found. I'm sure it's just tucked away somewhere invisibily in the library, but to the average user it's gone.
I'm wondering if this isn't an outgrowth of of the Justice Department settlement somehow -- basically locking down iBooks so the only content it really offers full support for is content purchased from the iBooks Store.
I mean, I will admit I'm not the average user, who maybe has a dozen books in their library -- books they more than likely purchased from iTunes. I have all the books I purchased from Barnes and Noble for my old, pre-iPad Nook, which I personally un-DRMed and moved to iTunes, plus a lot of other epub files I acquired from other sources. If you buy all your content from Apple, then I'm sure all the meta-tags follow the same pattern, and the books all sort and group correctly. But if you have epubs acquired "in the wild", then you're faced with the task of going through and making sure the author of all 65 Stephen King novels isn't King, Stephen or SteveKing or something.
H*ll, you can't even add your own artwork, which seems like it ought to be totally OK (why should it matter if I replace the TV-tie-in cover of Game of Thrones with a scan of the cover of my paperback?).
I can see, from a product management point of view, someone at Apple saying "well, the only reason users need to edit meta data is if they have pirated books, so why even bother with that functionality? If someone need to do that, they can donwload Calibre or Sigil."
I'm going to try to roll back with Time Machine tonight, and hope it puts everything back the way it was (after all, isn't that the point?). If it doesn't, then that seems a lot more sinister.