I like... but could you produce a version of this with the tail of the worm underneath the name instead of above. Also, could you insert the tag line "book lovers unite!" inside of the tail of the worm.
Another idea (since the tagline doesn't need to span the whole distance of the name "bookworm.com") is to put 2 or 3 books (as if on shelves) on each side of the worm. On the right side, the tail of the worm could be poking through the books (indicating that he has already eaten his way through them. On the left side, the books could remain untouched as they are ahead of him. If would appear as if the worm has paused and looked up to see the viewer and thereby created the O's in "book" as wide eyes to see who's there.