If you don't like the keyboard of the Kindle, I'd recommend the Sony 950. It has a larger screen, handles PDFs well, and is currently selling for $199 at Best Buy. It has a touch screen, so it's easy to highlight text and save it as a note. I've heard that it's possible to transfer those notes to a computer, but have never had the need to do that myself. Whether or not highlighting and exporting text will work depends a lot on the PDF. If it was scanned as an image, highlighting won't work on any reader. It would have to be OCRed first.
I would recommend going to
www.inkmesh.com to do your comparison shopping for books. It searches across all of the ebook stores and is a great way to compare price and availability. Stripping DRM is easy and makes it possible to read books from Amazon on my Sony reader.