I searched and searched, finally I found an audiobook reader app that I liked best, but it''s not perfect. I am blind... well, 20/800 or worse in both eyes, so I listen to a LOT of audiobooks. I have to constantly use a magnifying glass or giant fonts to read any computer screen (even the iPad). I subscribe to the library books for the blind (I have one of their special machines to listen to the tapes). And I am spoiled by it. These machines have speed/pitch controls. The player software that comes with the iPad will allow the speed of playback to be changed for audiobooks, but it is rather granular, not a very fine adjustment, as would be appreciated. On my PC, I use VLC, which is really ideal, it has a great speed control and a graphic equalizer, and it really helps a lot with many books that are hard to make out... or that you would like to "speed read".
Anyway, I found an app, called "Audiobook & Podcast". It is really pretty neat. It was written for the iPhone/iPod, but works well on the iPad2 that I own. I don't even mind the iPhone screen, as it is easier for me to read. I had heard the author was responsive to user requests, so I sent him some feedback and asked for speed/pitch controls. He said that Apple doesn't allow these controls to 3rd party authors!
I think that stinks! Apple should allow 3rd party authors to use these controls, or upgrade the iPod app to have better controls for audiobooks. A better speed control, a pitch control and bookmarks would also be nice.