E(n)tymologically correct or no, the information in this book is immediately applicable and simply stated. Really it's a collection of abbreviated essays, reflections, that the author has... given the inspiration he draws upon Chinese characters.
Maybe he's right, maybe he's wrong, maybe he's accurately reporting folk tales... does it really matter if he is the utmost authority on Chines etymology? Not if you are looking to use this book in the manner in which the title implies, Everday Tao, Living with Balance and Harmony. These are offerings for you to have new inner dialogs with yourself.
A previous reviewer recommended looking to this book for answers in a similar fashion one might look to the I Ching. He recommends looking up the character with a meaning most specifically correlated with your problem or question, and reading the corresponding passage for further reflection. I don't see how that could hurt. But i think you'd also be missing a lot if you left it at that.
My recommendation is that you read the passages in no particular order, and then maybe again in some specific order, seeing how the author has organized them in the TOC. Reflect without the desire to solve. Reflect without trying to remember. Let go of your egoistic needs -- you won't need them to enjoy the text.
Whereas 365 Tao is so non-technical as to be a beginners' text, Everyday Tao brings in more of the concepts and terminology that aren't covered in the more religiously oriented books available from Shambhala. The ancient Chinese characters bring even more shades of meaning to the concepts discussed. Works as either a reference or a meditation book.