Sheep or no sheep but I am sure that many many people buy kindle because it is the only ebook reader they are aware of.
I read a few other forums. People report that they got Kindle for Christmas or bought one as a gift. Why? Because they are the ones who read books or know other people who read books a lot. People who buy it as a gift think: WOW! Fantastic idea! They will love something cool like Kindle. They(the buyers) have no idea about existence of other ebook readers. All they(the buyers) know is Kindle. They(the buyers) buy it as a special gift for somebody they love and they(the buyers) think they will benefit from the gift.
Amazon is doing an amazing job of advertising. Doesn't matter whether there are ebook readers that might be better, you cannot beat such campaign.
P.S. I am sure that if I didn't have ebook reader and was not technically educated person to know the difference, my wife would get Kindle for me. It would be the only one she is aware of.