Some thoughts on differences: the Kindle seems to have a greater range of functions, while I thought the e-reader was lighter and crisper in design. I think the Kindle wins out for range and cost of readable books available, and convenience to buy and get, though that's really a marginal difference as neither are bad. Kindle also allows you to browse the Internet, and Sony doesn't. However, am I right that Kindle is more tightly linked to a single supplier, which seems risky? The Sony e-reader has plug-in tiny memory card things, to extend what you can store. I think both read PDF, but Sony can also read Word files. My friend at work has young-onset-arthritis (and likes massive fantasy novels) and the lighter weight of the Sony e-reader is a significant issue for her, though neither device is really 'heavy'. The i-Pad is out of consideration for me because of cost.
Here is a discussion of the current e-reader options, updated Sept 2010.
I would be grateful for any advice, experiences or opinions you might have.
(Another issue is that devices are always getting better, this is one reason I like being a late adopter. However, there comes a time when you have to jump in.)