Thanks for all your replies, I suspect the real answer is 'if you can afford £159 - £259 for an ebook reader you shouldn't quibble about paying us through the nose for an ebook!'
mr ploppy is right about VAT and I tend to avoid UK sites.
I think my real beef is that if I want a normal book I just pop onto Amazon and go, I don't usually need to check whether they have a good price or not. For ebooks, I need to check three or four different permutations, UK/US £/$ before buying.
One of the great features of the iTunes store is it just works and it is what it is.
Hey I'm a glass half full kind of guy and I'm really enjoying rediscovering reading.