I (native AmE) don't like it either. Saying "that is a not too good book"would be like writing "that is a not too good sentence." Would it be understood? Probably. Would it be correct? No. The tricky bit is that příliš pops up often as "too" or "too much" in translations, but "too" just doesn't work in this sentence. So it's good to know that it can also be used as "very" in certain contexts.
I wasn't sure whether to report my opinion. I did get this correctly, but I feel a better choice of words in English for what I think is meant by the Czech statement (and closer to the literal) is "That was not too good a book". No real idea why an extra "a" would be used (for emphasis perhaps?) and I've been speaking it for 72 years!