I upgraded from Kindle 2 to Kindle 3 for the reduced form factor and improved e-ink contrast. However, I have discovered that the most valuable new capability of Kindle 3 comes when combined with Calibre. I was accustomed to having Calibre download my favorite newspapers daily, which I would load into my Kindle 2 via the USB connection. I reckon I would have spent over $75/month using Amazon's 3G wireless delivery service (at 35 cents/mb if I remember correctly).
The Kindle 3 will download documents sent to
yourname@free.kindle.com when it is wifi-connected, at no charge. The convenience of finding my morning newspapers on my Kindle 3 every day when I open it is worth the cost of the unit by itself. Add to that the vastly improved e-ink contrast and it's a no-brainer.
My only regret is paying the extra $50 for the 3G/wifi version instead of just getting the wifi version. I doubt I will ever use the 3G--the web interface over 3G is speed-crippled and pretty well useless, and when I want something I'm generally in a wifi zone. My only other complaint is the Back button is right below the redesigned 4-way controller, and I sometimes hit it by accident when aiming for the down button. All in all, though, Kindle 3 combined with calibre is absolutely fabulous!