I wouldn't buy a Kindle, too much a one-trick pony. I do have Kindle, Stanza, Ereader, 3dBookshelf and iBooks on my iPhone, which means I've got an entire library in my pocket. The big issue with the Kindle, like other ereaders, is that you're pretty much tied to the one bookstore, and I've found that to be horribly restrictive, as there are plenty of authors out there who's work is geographically restricted as ebooks. Neil Stephenson's Snow Crash I got through Stanza, but not Diamond Age because I needed a US addressed credit card. There are books I can get on Kindle easily, but others I can only get from Stanza and now iBooks. iBooks is a damn good PDF reader as well.
I know that the Kindle is supposed to be better for reading in bright sunlight, but I don't like reading books in bright sunlight, and the Kindle is compromised in the dark. I also still buy lots of dead tree books, four or five in the last two or three weeks, but I hate carrying books around with me, they take up space, get damaged, and can be damned heavy, if its a hardcover. I love ebooks. I love dead tree books. I love books, in whatever form they come in; I've got four on the go at the moment, one on the phone, and I don't think people who love reading will give up on real books, they'll just embrace the sheer joy of being able to carry dozens, hundreds of books around in their pocket, the same way they now carry music.