These don't really qualify as online books, but I've been having my class experiment with using Google Docs more effectively this year. We put several chapters of The Scarlet Letter (public domain) in shared documents and annotated away.
It's funny how contributing links to a discussion thread is so much easier for people than adding to a wiki page... or at least that people are much more likely to contribute to a discussion than to edit a wiki page. I've seen this same process with several other areas where we have collected resources (links). I think it has to do with the social element. Interesting food for thought.