I've checked out Adobe Reader LE, Foxit reader, and PocketxPDF viewer on my Windows Mobile.
None of them are able to highlight (and annotate to go a step further) on a PDF. Unforunately, it also seems that there is no specification for annotation support on e-ink book readers and each company does it its own way - Kindle on its own proprietary format, Sony in an XML database, the Bebook on a Sqlite database, the Entourage Edge saves annotations but the PDF is converted to an image file. Personally, I think annotation (whether scribbles, highlighting or notes) could be implemented as an extra layer in the PDF format (just like how the OCR layer is a layer on top of a scanned image). This could standardize the mess of annotation implementations and pave the way for true digital reading and annotation that can be synchronised and viewed across all platforms. At present, the annotations made on an ereader is confined to the ereader. An additional layer could be a clean solution IMHO.
I got a Nook in the end after giving up on being able to find a reader that could do annotation natively. Since I can't annotate properly - touchscreens serve no useful purpose to me. Might as well go for the cheaper and cuter reader then!
BUT, I havent given up on trying to find a workaround do highlighting while reading PDFs on the Nook. Cumbersome, but I'm thinking of reading on the Nook and highlighting the doc on Windows Mobile. Highlighting is just too important for me, and I can't think of whatever else to try.
Anyone would like to share any workarounds you have, or better yet, any app that you're aware that does highlighting on Windows Mobile?
Comments and help appreciated!