First impression: Excellent. I see you got some inspiration from a certain Userscript and I applaud you for your choice. You managed to save lots of whitespace.
I have only one criticism with the UI. You removed the toolbar normally found in the end of each feed item. This is aesthetically pleasing but it introduces a couple of usability issues:
1) I sometimes accidentally click on an item and want to keep it unread, but the 'Mark as Unread' button is unavailable.
2) In full view, the only separator between feed items is a thin grey line. Please make it thicker and darker.
I have noticed a problem with all Readers that I hope you could address. Some XML's only show the latest item. If the reader doesn't update quickly enough, it would miss some items. I would appreciate it if you somehow made your reader update these problematic feeds more often.
Edit: When I click on an item to mark it as read, the only indication my click registered is that the unread count becomes reduced by one. Please show more prominent indication that the item is read.