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I use a iPad as an e-Reader device, but it's technically a tablet computer. The only real advantage is that it's a multifunctional device (e.g.: You can surf the web, read email, listen to music, word processing, etc.). I use it mainly for web surfing and textbooks and the IPS color screen helps alot... The backlit display isn't a big deal since I sit in front of the computer. Also, the Adam tablet coming out in a few months will have a color e-Ink screen (costs around the same as the 16GB iPad) and runs Android... The real advantage of these devices is that you aren't locked into one e-book store and you can buy books from other sources providing they have an app for the device.
Of course, multifunctional devices will cost a lot... If you don't need internet on a portable device, look at the Kindle 3 (which supports PDFs) or the nook as those seems to be a popular choice. Amazon and B&N has a big selection of books to buy from, so it's not a big deal.
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