Apparently you can drag files to your device, but you can't manage your library of books using iTunes. Which is totally f-ed up.

And once the files are on the device, you can't get them off in iTunes. Which is EXCEPTIONALLY f-ed up, though I suppose you can deleted them from the device UI.

I'm getting ready to go on a long vacation. I have over 700 books on my iPad to read on the trip (no, I won't read them all, but I want to have them all to choose from), out of my library of about 2,000 books. I really want to add a few more books before I go, but I'm scared about what will happen. It has taken me years to add these books to iTunes from folders all over my computer and over a year to assemble this collection, and if it screws them up I don't think I'd ever be able to replicate the list. I purchased this iPad and one other for the purpose of syncing books through iTunes, so with this update I feel like Apple has broken their agreement with me.So, what will happen if I sync up my iPad with books on it?

My problem too...I made the mistake of downloading 12.7 this evening before I go on vacation tomorrow...guess I'm not syncing my ipad tonight 😝

You'll be fine if you sync. The books are left alone. https://www.y42k.com/2017/09/15/cleaning-up-after-upgrading-to-itunes-12-7/

Attach your device.After the device appears in iTunes sidebar, select the 'Books' folder under the 'On My Device' section.Drop the book in the Books folder on the right half of the window.

Attach your device.After the device appears in iTunes sidebar, select the 'Books' folder under the 'On My Device' section.Check/Uncheck the box next to the book in the Books folder on the right half of the window.Drag and drop the book to add in to the window on the right side to add new books.Delete a book by Ctrl-Clicking (right clicking) and select 'Delete from Library'

I tried all the ways suggested with no luck. All I ended up having to do was right click the ePub file in finder, then select "open with" then click iBooks. It added it on my Mac and was instantly available on my iPhone.