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I love my K1. Tavi is a great. I use him at the beach and in potentially dangerous situations (ok so at the beach). But I would not use him as my day to day reader any more.
Octavia, a DXG, is just that much easier to use and better to read off of. Ignoring the screen size, there is a huge difference between the functionality and screen contrast. The K1 will not have collections and will have 4 Grey Scale resolution. The K3 has collections, 16 gray scale resolution, and the Pearl Screen.
There will be a decent size and weight difference with the K3 being lighter and smaller.
The K3 is going to get firmware updates. The K1 has not gotten a firmware update since just after the K2 was released.
Go with the K3.
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