The average human retina (20/20 vision) can no longer distinguish between two pixels when the field of view (FOV) angle is 0.000333 radians. Steve Jobs used this to say a 300 dpi screen held 10" from the eyes (retina) would not show pixels to the average human eye. We can apply that principle mathematically to determine at what distance various resolution screens need to be held in order to no longer distinguish between two pixels, that is, see individual pixels.
Here is a comparison list of commonly available devices:
- For 326 ppi, distance required for no pixelization = 9.2" (iPhone5)
- For 268 ppi, distance required for no pixelization = 11.2" (iPad3)
- For 216 ppi, distance required for no pixelization = 13.9" (Fire HD, Nexus 7)
- For 170 ppi, distance required for no pixelization = 17.6" (original Fire)
- For 162 ppi, distance required for no pixelization = 18.5" (iPad Mini)
- For 132 ppi, distance required for no pixelization = 22.7" (iPad1 and 2)
In all likelyhood most people will not routinely hold the iPad1, iPad2, iPad mini, and original Fire far enough away from their eyes in order to no longer see individual pixels. The Fire HD, Nexus 7, and many newer smartphones similar to the iPhone5 resolution are more likely to be held at an adequate distance to no longer see individual pixels.
That of course is with average vision, so everyone will experience something a bit different. Also this is just one aspect of a screen. The quality of the screen is very important, as are other factors like font rendering, etc. For some people, the pixelization might not matter at all. When I used to read on PDAs with low resolution screens (less than 100 ppi) I found it readable but not very good. Now that I've been spoiled by high resolution screens I cannot use the older devices anymore as I would be too aware of the pixelizaton and that would be too much of a distraction.
I personally find that 200+ ppi works best with my eyes. My first iPad was an iPad1 and it was okay for running apps and light web browsing, but any activity requiring a lot of reading was very problematic as text was too fuzzy and pixelated. On the other hand my iPad3 works well with any task as the screen and text are sharp and crisp. I find the text on my Fire HD is sharp and any pixelization is rarely noticeable. For my eyes, I think dropping down to the iPad mini resolution would be pushing the edge a bit too much and I would most likely have issues when reading for long durations. I wanted the mini just for reading, but after looking at the specs and price I went with the Fire HD instead. If the 2nd generation mini can increase the resolution to over 200 ppi I'll probably buy it.