The so-called "library" part is just the data header connecting the ".device" to the system. It enables Exec to start the driver at boot time and DOS to generate a "struct DeviceNode" in the DOS list. Handlers like file systems use a similar (but different) means of initialisation. The driver uses the library "open count" and other flags to make sure that it is not expunged while tasks are using it, much like a library.
I was wondering if I needed to regenerate the files with fdtrans, but wasn't sure how to even get a .device out of it (I'm using old source code and don't have the original files that were apparently passed through fdtrans).