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I honestly do see your point, rwsimon. I still think by-and-large that iTunes is a very popular store for several reasons, one of which being that people are buying from it. (Or are tied to it because they don't know any better -- like a report that says MSN.com is the most popular home page.) So while I can grant that you've not used it, or that many people here have not used it, I would offer that the majority of iPod owners have. We're in the minority and companies cater to what they perceive majorities want.
One thing that's very interesting to me is that many new iPod users typically have larger CD collections. It's fairly trivial to rip a CD into an iPod via iTunes. A kindle user will already need to have an electronic version of a book in order to have it processed. This makes going from p-space to e-space much more difficult and burdensome. Although Amazon might make the transition easier. (I know they do this already for some titles. You can buy the e-version for a substantially reduced price if you've already bought the p-version from them. I can't remember the name of the service.)
Cheers,
m
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