I thought I'd add my experience to the mix as I just received a copy of my book "Deco Tech: Designs for Coloring" which I published through 1stBooks.

I chose them primarily because I had received a copy of one of their books as a sample from a printer who was quoting a run of 1000 books that I'd be publishing myself, and it was a nicely produced book. Having self-published before I knew that connections were the key to succeeding with any book and I had none. I researched the cost of 1stBooks and a few other POD's and realized that for the same cost of my initial run of 1000 (on my lowest quote) I'd be able to have 1stBooks publish it and also take advantage of some of their advertising options, as well as benefit from a direct line into the book industry. So I submitted my book and began the process.

These are the problems I had:

1 - I was told my images could be their original 7.5 x 10 inch size which wasn't true
2 - I was told I could submit my files in Adobe Illustrator EPS format - also not true
3 - Some designer re-designed my gorgeous cover for no reason and made it look goofy
4 - I was supposedly able to buy my book at "wholesale" but it turns out that in the information I was sent "wholesale" was meant to be the discounted price on their website which was $11.95 (instead of the retail price of $12.95). The most common wholesale rate in the industry is %45 of retail so I thought I be getting my books for really cheap.

The solutions:

1. The images were shrunk to 6 x 8 inches. I'm only cool with this alteration because now the images will fit well into a matted 8 x 10 inch frame - giving me an added feature for marketing. 1stBooks did offer to refund my money when this mistake was discovered - but I figured it was a good publishing opportunity before and it still was.
2. Turns out I needed pdf pages in one file - as the free Adobe Acrobat program allows you to save only one page files I couldn't provide this and I wasn't about to go buy the program. I was informed that it would normally cost over $200.00 to have them "merge the files" but they would waive the fee as it was their mistake.
3. I re-submitted my original cover and told them to use it instead of the re-designed one which they did.
4. I re-read their information and it states I can buy the book for "the wholesale price (as shown on our website)." As I didn't know the book would be listed at a lower price than retail I had no way of knowing that this wholesale cost would be more than the industry standard - I essentially feel that this was a mistake in my expectations and I could've figured out the cost (within range anyway) had I bothered to ask or research their site. I don't intend to buy a lot of copies of my book anyway - I'm trying to sell it!

The "payment schedule" is a way for you to choose the price for your book (on the web and retail), not a fluctuating royalty rate. You're given a selection of prices and told what you will get from each sale - both from their site and in retail/online stores. I felt that the average price was reasonable and that's what I chose. I feel that this system is a way for them to please each authors individual preferences while still giving 1stBooks some control over the books price and I'd rather have a selection to choose from than just be told what it will be. I could have used the "schedule" to bring my books cost to me down by making the 1stBooks website price lower, but this would inhibit in-store sales of my book - again I believe this was a well thought out way to maintain some control while providing options that would appeal to authors and I think it's better to have a choice in the matter so I appreciate this system.
As to the quality of the book - the colors are bright and the black is solid on the cover. the inside pages have solid black headers and footers which came out a little faded but with text this wouldn't be a problem; the lines for the images are crisp and clear...

I'm satisfied with 1stBooks. I'm planning another volume of coloring designs and I intend to go with them again - unless another publisher decides to publish my series of books and makes a good offer... I do retain the rights to my work so I'm free to approach other publishers and I can remain open in regards to the future of my book. In the meantime I have a professional (though not perfect) copy of my book on the market that I'm free to promote/sell which comes naturally to me as I like my book! I won't know what the sales are like for a few months, but people seem to like Deco Tech so far and I've only just started promoting it...

I'd suggest that if you choose 1stBooks address any concerns you have via email so you will have a record of their response should any problems or discrepencies arise.
I'd also suggest that you have a good idea of what you want for your cover in your mind before you approach them - a professional cover will help sell your book and the more it reflects what you've written the happier you will be. Think of symbolism you think is important, what style and colors you'd like it to be, maybe browse the web for covers you like - not to copy but for as a reference for the designer...

I hope this is valuable to someone - remember - you can spend years trying to get your book published the usual way. With 1stBooks (or some other POD's) I can still look for other options while my book is on the market. Maybe your book won't sell but at the very least it's a great promotional tool that can be used to advertise your skills in a convenient way. Plus it's in print and it's unlikely to be cancelled (some publishers will cancel a book that sells ONLY 100,000 copies - I would pesonally consider my book sucessful if it sold that many!) There are also a lot of grants for writers out there and it's the authors initiative as well as his/her talent that will win these grants and open doors for the future. POD is a way for you to pry these doors open and whether POD publishing is respected or not is irrelevent if you have a solid book - then all it takes is for your book to be available and be promoted in the right way.

Anyway - good luck in whichever path you choose!

John
+ If you're interested you can learn more about my book Deco Tech: Designs for Coloring here:
www.johnwik.com