They were well-outfitted.... for what they thought would be a quick and easy expedition.

A lot of people thought the expedition would break through in one year, or at most, two years. They were using the best ships they had at the time, which they thought would be adequate for a polar route they'd never seen before. The heating on the ships was weak, and the body was mostly wood (strong wood, but risky to use for breaking through ice).

The canned food was bought from the lowest bidder, a man named Stefan Goldner who bid an unbelievably (and suspiciously) low price. He slapped together the cans using meat from animals who had been malnourished and sick, and spoiled vegetables. He soldered them together with poisonous lead. The crew could've survived one winter of eating from these cans (and some of them definitely did) but that exposure to lead and poisons does permanent damage to the body, and eating it nonstop over 4 or 5 years proved deadly. Some of the cans weren't sealed properly (there is evidence of bent and cracked cans) and quickly became rotten. But they still had rifles to hunt bear and seal and probably caught fish to salt and save on the way. If they had completed the journey in one winter, that food wouldn't have been as much of an issue.

Like you said, a high amount of space was taken up by nonvital things. As far as books, I think the Terror had 1200 and the Erebus had 1700, plus writing desks. That took up a lot of space where food or medical supplies could've been stored! Besides, most of the laboring men couldn't read and wouldn't have had time to learn! Those books and desks were a waste of space whether the expedition was planned to take one year or ten!

Anyway, in conclusion I think the ships were outfitted poorly because the expedition wasn't supposed to take more then one or two years. I think they got too confident in their own abilities and didn't plan adequately for a worst case scenario, which is exactly what happened. The moral of the story: plan ahead!