I received my Kindle the other day and have been using it ever since.
Kindle uses something they call electronic paper to render text much like text in a book. It works well and it the heart of the device.
To my surprise, it is more than just an e-book reader. It plays audio books from Audible too and I've got lots of those. It will open text file, HTML files, PDFs, and Word files.
It plays MP3 files too so you listen to music while reading. You can't control the playback as tightly as you can on an iPod or MP3 player, but I was surprised to see this feature.
There's a web browser too. But it is severely limited. It won't only links that pop new windows and it was not play video of any kind. That's okay. I'm not going to use the feature; however, if Amazon enhances the browser it could be a win for the device.
Navigation and usability is a little clunky, relying on buttons built into the device. After using Palm devices and iPhone, a touch screen is really hard to give up. I think the device could benefit from such technology.
The screen is black and white, which is fine most of the time; however, color display of book covers would enhance the experience.
Overall, I am impressed by the device and if you are an avid reader, I recommend the Kindle.