estudiando - that list won't work, unfortunately, since it only covers bigrams (and not specifically segmented words). Though it would actually be very easy to build a word frequency list ourselves (using an open-source text segmenter) if we could just find a large enough text corpus - anyone know any good sources for those? (there's a link for one from that site you mentioned, but the link seems to be broken)
Tone number insertion has actually been fixed for 2.0.7, we didn't think we could do it without an undocumented API but it turned out it was very easy; just put the tone number you want in the clipboard and tell the system to execute a paste command. Offscreen text we can't do much about until we add our own (optional) custom keyboard in place of Apple's and hence no longer need to rely on their text field control at all.
Ducksausage - as estudiando said, you can set the priority order in Manage Dicts.
The "word lists" feature is just a stopgap measure until we get our full flashcard system implemented on iPhone, so the layout of entries in that is designed specifically to be compatible with the import format of our flashcard system, though I agree it's kind of awkward to actually read through. The file split is also designed for that - English-to-Chinese and Chinese-to-English entries have to be in separate input files for our flashcard system to deal with them correctly. It should be easy enough to fix these things in a text editor if you transfer the files to your desktop, though.
There actually is a very limited text editing capability built into the current document reader, though we've hidden it since it's kind of slow / buggy and doesn't do well with large (> 10k or so) documents; "Enable text editing" in the "Reader" panel of Settings will add an Edit button to the document reader screen. We're planning to expand this to a real / large-document-friendly text editor in a future release, though.
DotComCTO - you can set searches to always start on the first dictionary with the "Dict search order" option in Settings / Dictionary. That will jump back to the first dictionary in the search order every time you change the search term.
We've had a bunch of people ask about TTS in the reader, but the syllables are so slow / deliberate (designed for getting a handle on the nuances of individual Mandarin sounds) that I'm not sure how practical it would be; there's also the problem of reliably getting the pronunciation for characters that aren't already accompanied by Pinyin. I suppose as you say that it might be useful in an emergency, though.