This is a great review of a standard app - iBooks. It also includes a link to a great podcast about alternate ways to integrate iBooks into the classroom
Touted as "the simplest way to make your own interactive eBook" this free program works on both Windows and Mac computers and is a great alternative to Apple's newly released iBooks Author.
Scribble Press (FREE) is a book creation platform that allows students to both write and illustrate their own stories. Final products can be downloaded to iBooks or ordered as a hard copy.
For those looking to create ePubs for students to use on mobile devices, Wappwolf is a great solution. Connect Wappwolf to your Dropbox account, upload a file, and run an action to convert it.