Does the fact that they are housed in the library or the academic institution mean that the use of copyrighted e-reserve material qualifies as fair use?
No. This fact alone does not ensure that a use is fair. If the use does not qualify as fair use when all of the four factors are analyzed, giving due weight especially to the impact of the use on the potential market for the original work, then it is a violation of copyright whether or not the provider of the material is a nonprofit educational institution.