I've got a 5" PRS-350 so pixel density on that is higher compared to most 6" readers. Definitely still prefer the PRS-350 for reading fiction.
However, reading on the new iPad isn't atrocious anymore. I couldn't stand using the iPad 2 for recreational reading because of the low pixel density. With the new iPad, I can read on it in a pinch if I don't have any other device I can use. I'd still gravitate to my PRS-350 or iPhone/iPod Touch if those are available but iBooks in landscape mode on the iPad is an acceptable alternative (for short periods of time, in medium lighting conditions).