El zorro listo y el cuervo con queso

What is the difference between “ser listo” and “estar listo”?

The word listo changes meaning depending on the verb in front of it. With ser (a fixed quality), ser listo means to be clever or smart. With estar (a current state), estar listo means to be ready. So es muy listo describes a clever person, but está listo just means “he is ready.” Picking the wrong verb changes the whole sentence.

In this fox-and-crow story the fox is the clever one: cómo el zorro era muy listo (“how the fox was very clever”) and qué zorro más listo (“what a clever fox”). Here listo with ser means smart, not ready — the trick the fox plays to steal the cheese.