I think this comes down to what your priorities are.

My wife has a Kindle, and I have an 64GB iPod Touch which has a software Kindle reader, as well as another software book reader that is better at public domain books and some other apps to download/view various content, etc.

If your priority is READING, you probably are going to want something with the e-ink screen. They are much easier on your eyes than the traditional LCD screens, and of course, having a bit larger screen than my iPod Touch aids in reading as well.

However, with my iPod Touch, I can have lots of books, lots of different reference materials, and as Eric points out, it is small enough to actually have it with you all the time. FWIW, the 64GB Touch has the capacity to carry around a LOT of stuff.

I've probably got well over 100 books, both commercial and public domain (takes very little space), 2000 songs, an off-line copy of Wikipedia, off-line dictionary, off-line maps, random reference materials, podcasts, TV shows, pictures and I have space leftover.

As for Kindle books, you buy a book and you can download it to your device(s). I think you get at least three devices you can have it on concurrently. So it works fine for me to have a copy of purchased items on my wife's Kindle, my iPod Touch, and even on my PC (they have a PC version of the Kindle reader now). If you delete it from the device, or de-activate the device from Amazon's web site, it goes back into the pool of available copies.

The Kindle's user interface is kinda clunky, but works fine if you are just reading books. But a general purpose device it is not, much contrary to my iPod Touch.

It should be noted, that the clunky UI of the Kindle does make it somewhat difficult to jump around, making reference material less friendly than it could have been. The Kindle really should have had a touch screen.

Not all books are available on the Kindle, but the majority of new books are. Right now, a sampling of the commercial (purchased) non-fiction on my Touch:

- 2009 Current Medical Diagnosis & Treatment
- Mountaineering First Aid
- Medicine: For mountaineering
- Taber's Cyclopedic Medical Dictionary
- Dog Owner's Home Veterinary Handbook
- Illustrated First Aid Guide
- First Aid: A Pocket Guide
- 98.6 Degrees

To show what kind of books I wanted that were not available on Kindle, here are a few:

- Gale Encyclopedia of Medicine (2001)
- Sunset Western Garden Book (2007)

Apple is rumored to release an "Kindle Killer" this month, although the rumor goes on to suggest it won't actually ship until March. If this runs some variant of the iPod Touch/iPhone OS, then it will likely support Kindle books via a software application.

Oh, the Kindle has very good battery life, the iPod Touch does not. I carry an external re-chargeable battery pack to make sure I always have juice.

-john