I get a fair chunk of my e-reading material from my library rather than buying, because unless a book/author is a proven "keeper" to me, I don't care how cheap a bargain it is, I won't spend actual money unless it's something I would have probably bought anyway.
The library is great because it lets me try stuff and discover new authors/titles whose works I might one day get if they go to the aforementioned bargain prices.
I have this ever-growing Wishlist which takes forever to load because every time a book looks even vaguely interesting, I click to add in case I might like to read it later when I've a free borrowing space, and my five alloted Holds slots are almost always full of the stuff I absolutely want to try first.
I'm a lot more willing to try certain stuff I probably wouldn't have even in paper at the library, simply because it's so easily portable and I don't have to lug it back and forth if I decide it's not worth my time. Just delete the uninteresting file.
I have my loan period automatically set to 7 days to help free up stuff to recirculate and frequently use the Return Borrowed Item feature of ADE to open up a slot for something new. I try never to keep more than 2 Mobi or audiobooks on my account because they can't be returned early (aargh!).
I love my library, both for e-books and hardcopy, and it's one of the things I'm really happy that my tax dollars are going towards (unlike spending $6 million on the legal fees of persons pretty much convicted of defrauding the province, or a half-billion on a retractable stadium roof that doesn't close under weather conditions we encounter very frequently in this area while cutting health care and education funding again and again, grrr).
My advice: if you love the selection of your library and the ease-of-reading features of your Kindle, go forth and strip and convert and feel no qualms because this is how your tax dollars are supposed to work.
And you want to support your public library anyway by giving them some solid numbers they can point at for patron usage, without which your local government will probably try to cut funding, like ours did until the protests hit them.
Every user helps them grow, at least until the budget cuts come along.