Lovely idea, this.
I do wonder if this won't be the future for e-books. Rather than simply converting printed copy into e-ink, the porting process will be rather more involved. After all, websites are e-books by another name. A case of convergent evolution.
It's really not true that children do not read any more. They read far more than I ever read as a child - and I was a prolific reader. What they don't read is traditional books. What they do read is hyperlinked text - and very proficiently.
The FLIPS series is far more than a worthy attempt to reach out to a new audience on its own terms. The FLIPS series is a blueprint for e-books everywhere.