When I bought my first gen kobo it was the cheapest ereader on the market in Aus (that I could get retail). Its slow, had a few teething bugs re: PC connectivity (all fixed w/ calibre and new kobo app), and battery is nowhere as advertised, but it was cheap and I read 3 books on an overnight flight to london the first fortnight I had it.
Then amazon smashes the kindle price and suddently the kobo is no longer a good deal, esp as the Australian kobo (Borders) store has a poor selection.
At the time it was the best option for me. Now I tell people to buy a sony if they don't want to be tied to Amazon, or a kindle if they want the best device (I know you can strip DRM etc. but this is assuming a layman who doesn't want to bother with any teching about). My next purchase will be high end (sony or kindle), I don't want to deal with lag, slow bootup and relatively poor battery life, but at the same time I know I got a good deal at the time - and at the end of the day, its doing what it says on the tin.
If they could get rid of the slow bootup (lack of sleep?) + page turn lag then I would have no hesitation recommending it but as it is most people would rather pay 50-100 more for something that performs much better (the cost over the lifetime of the device would end up as negligible).