I have a Sony Reader, not a Kindle, but for this discussion they are about the same.
I agree old books on my shelves cannot be transferred to the Reader.
I paid $300 two years ago, and now have purchased 200 books, and downloaded 100 free books from Gutenberg. I saved about $1.50 per book when considering the lower price and sales tax savings. So, not even counting Gutenberg, I figure it has already paid for itself.
There are thousands of books available on Project Gutenberg for free. If it is out of copyright, and relatively well known, I have found it is on Gutenberg.
Of the 300 books on the Reader, about 100 are unread, so I always have a fulll library of unread books to immediately choose from.
The Reader is definitely not good for technical books or anything with charts or graphs. If you are likely to be turning back to previous pages to look at figures, it doesn’t work well. Nor can you easily underline or make margin notes.
It is great for basic narrative. Fiction, history, etc.
Not having to find shelf space is a blessing, not a drawback. I guess this depends on how many feet of empty shelving one has.
It is not good for sharing.
It’s physical form makes it easier to handle. This is not soemthing that is obvious until you use it. There is no need to use fingers to keep pages open. For eaample, it will just sit on your knee in a deck chair without having to stick a thumb between pages to keep it open.
New models have a LCD light they have somehow managed to integrate into the screen. So, it can be used in bed without bothering the other person.
The screen is not the same technology as a computer screen. The screen is not backlit and there is no computer screen eye fatigue.
Power is used only when changing pages. So, battery life is not a problem.
Bottom line: It’s a question of personal tastes and preferences. If one likes the feel and smell of a book, it doesn’t do that. I have now reached the point where I browse through the book store, note titles, then download then to the Reader. So, I guess my behavior reveals my preferences.
I think Sony and Amazon have just started on a price war. The Reader is $200, and Kindle $300. Look for more discounts.