This book not being under copyright (afaik), the text is almost certainly from some guy in his garage grabbing Gutenberg Project, etc., books and formatting them for various e-readers.
He probably has some boilerplate stuff like "Formatted for Kindle by John Doe", which gets inserted into the Kindle .mobi version (Kindle being the dominant platform, he does that first). Then he does a search-and-replace, turning "Kindle" into "Nook" in order to create a version appropriate to that platform.
In fact, he could use something like Calibre to do the conversion from .mobi to .epub, which I believe allows for regular expression substitutions as part of the process. That would allow him to get whole shelves of the Gutenberg library in one simple, automated process.
Nothing insidious here. Just somebody being a little bit careless.
I would assume that eclipxe meant that the software shipped with the Nook does not allow for on-the-fly text modification. Even if it did, this is the only occurrence of text substitution that has been seen, so the fault still lies with the publisher.
To the contrary of the snark, throwing this out there on the internet may have been about the only way for the post's author to get attention of a Nook team member. It wasn't B&N's fault (they're just retailing what they're paid to), so getting someone knowledgeable to look at the issue via nook.com may have been ... unlikely.
It was posted, it got discussed on HN, within a few hours we have a good relevant answer from an insider.
Why do all that? Just look at the file you downloaded in another viewer, see if the word is still there. Then, load another file that contains the word kindle and see if it gets changed. What's so hard about that?
Most likely the author or conversion service took the Kindle edition, ran a search and replace for 'Kindle' and there you have it.