Stephen Hackett took the updated Pages for a spin and compared its digital book creation features to the existing iBooks Author app for Mac. As it turns out, the new functionality isn't a replacement for what iBooks Author can do:
It cannot open my iBooks Author file for my book on the iMac G3 and history of Mac OS X. I’m not super surprised by that, but as the future of iBooks Author is unknown, I’d like a way to know I can edit this file using Pages in the future.
The options when creating a book in Pages are currently more limited than what is available in iBooks Author. There are fewer templates available, and the hierarchy of chapters and sections are nowhere to be found. iBooks Author includes tools for a Table of Contents and Glossary, and these are missing from Pages as well.
Pages also lacks iBooks Author’s widgets. These can be used to add Keynote files, pop overs, review questions, videos and even HTML content to books. This is a pretty big oversight, as these tools can add real interactivity to a book.
iMore's Serenity Caldwell has also clarified with Apple that the eBook creation feature in Pages is not a replacement for iBooks Author, which is still "continuing development" – whatever that means, given its erratic update schedule and lack of an iPad version.
I was hoping to be able to create rich, interactive iBooks using Pages for iPad, but unfortunately this isn't possible with today's update. Still, I'm going to experiment with the feature to generate EPUBs for my longform reviews directly from iOS.
See also: AppleScript support for eBook creation in Pages for Mac.