Smashwords is well known for Meatgrinder, its automated conversion platform. Meatgrinder is the reason why Smashwords can sell ebooks in many formats, including everyhting from HTML, RTF, and DOC to Epub and Kindle.
But one problem with Meatgrinder is that it doesn’t offer output that satisfies ebook design pros, many of whom think that (compared to making an eBook from scratch) it’s not easy to control the quality of the output. A lot of the pickier eBook creators (like myself) don’t like it for just that reason.
Starting in 2012, Smashwords is going to allow everyone to submit other eBook files instead of the DOC file that is used as the source for Meatgrinder. This new service will be called Smashwords Direct, and it means that an author can make a beautiful Epub and offer that as the preferred format.