Kindle 3
I do also have an iPad and use it for reading some color Magazines, light Internet Browsing and PDFs; last one, is the one where iPad shines when using GoodReader.
The Kindle 3 is really portable and light. You can use it at home, at bed , outdoors, has the perfect size.
The Kindle DXG is not as heavy as iPad but it is kind of bulky. For reading the same novel or book, it makes no sense to me. The DX is more suitable for PDF files, poetry, or computer books, where you need a big screen to avoid cutting off some lines. Like I said, you have an iPad already so you can use it with Kindle app. for those type of books.
Also, Kindle 3 is less expensive ...