I finally decided to take the plunge and buy an ereader. My choice was the Kobo, mainly due to the low price and good reviews.
After tax it cost me C$ 168.37 here in Canada.
The Kobo has a 6-inch E-ink screen, 8 levels of grey scale and supports ePub and PDF formats. It comes with a USB cable which is used to transfer books as well as charge the device. The Kobo software installers for Windows and Mac are on the device itself and can be installed after you connect the device. This software is mainly used to buy books online and transfer them to your device. A more comprehensive list of specs can be found here.
The biggest drawbacks of E-ink is its speed, since a 'turn of the page' requires the whole screen to be reset and redrawn. On the Kobo this takes 2-3 seconds. I initially thought this would be annoying, but once your start reading, you really don't notice the lag too much and its definitely tolerable. However I must mention here, that this is only acceptable for when you're reading a book from cover to cover. Jumping around is cumbersome and rather frustrating. You can only go back and forward one page at a time, or go to a specific chapter from the table of contents.
I also tried a few PDF's and wasn't terribly pleased with the results. ePub's are read by the device and each page shows only as much text as would fit on the Kobo screen. For PDF's, the whole page is displayed as it would be displayed on a computer in the original PDF. There are magnification options, but then the page gets too big to fit on the Kobo screen and it requires you to navigate around to be able to read everything. That can drive you nuts with the 2-3 second lag for each click of the navigation buttons. But having said all that, all textual formats (PDF, TXT etc) can be easily converted to ePub via free online website converters or Calibre conversion software.
The e-ink screen is quite a pleasurable to read off. Since it is not a source of light, but you read by light reflecting off the screen (just like paper), there is no eye strain associated with using a computer monitor. The only gripe I have is that the screen itself is a shade of grey and a lighter colored screen would make for much better contrast for the black text. This is a minor issue though and should not cause problems.
Transfer of files to the device is straightforward. The Kobo shows up as a hard drive and you can simply drag and drop your books to it. Once unplugged, the device will automatically process the newly added files and will make them available to be read. And yes, this process works perfectly on Windows, Mac and Linux! [The Kobo software doesn't support Linux, but you don't need it anyways!]
Reading on the device takes a little time to get used to, but once you get a hang of it, the experience is quite fulfilling! The ideal use of the Kobo is to read novels or any others books meant to be read from start to finish without jumping around. I would not recommend it for textbooks or technical documents (which I also wanted to use it for sadly) since the screen is too small and the navigation too slow.
Ereaders are definitely the future. I would expect them to have taken the world by storm in another 3-5 years and for paper to be a thing of the past. A bigger screen and faster e-ink response times will make such devices a more useful tool. Combined with touch-screen/stylus input it really would be a complete paper replacement. Color e-ink is also in the works so magazines and publications which rely on eye-candy would be willing to publish for these devices.
I initially wanted to get the Que ProReader which would have been a more appropriate tool for my intended use, but unfortunately they pushed back their release date and went back to the drawing board after facing a lot of competition from the iPad. However I expect most if not all ereaders will eventually evolve into devices like the Que.
Questions and comments are welcome!