I personally think the keyboard on the kindle is pretty horrible. It seems designed to avoid accidental presses, the result being it avoids being typed on
But, I like the k3 form factor because the extra space on the bottom makes it easier for me to hold it. I use TTS enough that i will miss not having it. And with audio and double the memory, it opens up many more possibilities for devs to make some cool stuff. The physical page buttons is a plus. the battery is user replaceable.
I'd love it if Amazon updated the k3 with the improved display. Call it the kindle classic. And another version with the light. Call it kindle classic paperwhite. It won't happen though. I think amazon keeps the k3 around primarily to preempt possible accessibility complaints.