I'd love to be able to sync my books, but for some reason when I click SYNC on just the books tab, it tells me that it needs to erase all my movies, music, and tv shows that are on the iPad... Not sure why. So I just end up dragging and dropping my epub files from Finder into my iTunes library, and then dragging and dropping them from my library onto the iPad. Then they show up in iBooks on the iPad.
I use Calibre to convert PDFs to EPUBs.