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I am in a similar boat. I currently have a Sony Reader (PRS-505), and am very happy with it. However, my main complaint is that Sony's bookstore has horrible selection and worse prices. I've been eyeing a Kindle for some time, but I really don't like having a keyboard on the face of the unit (and yes, I have used a Kindle 2). When the Nook was announced, it seemed to check all of my boxes:
Wireless bookstore? Check.
Good selection and prices? Check. (I have 120 ebooks in an Amazon wishlist - 100 of them were the same price or cheaper from B&N.)
Reads my existing ePubs? Check.
Syncs last-read place with an iPhone app? Check.
Bonus - reads the eReader books I've purchased since 2001? Check!
I went into a store and used one for about half an hour. Pros: Store browsing and purchasing experience was good (of course, I "purchased" a free book); font size/selection was nice; feel of the unit was good; eInk screen was great (no surprise there) and the page turning speed wasn't an issue for me. Cons: I crashed it once (trying to change fonts); the "formatting" message whenever you open a book (not just the first time); and getting used to how the touchscreen responded.
The Nook is on my christmas wishlist (no idea if it or a certificate will be under the tree). If I don't get it for Christmas, I'll likely buy one next year. Even if B&N never updates the firmware, I think the Nook is a great eReader. However, I fully expect over the next several months that B&N will correct many of the deficiencies of the current software, which should make it a very capable competitor to the Kindle and Sony.
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