I made a review of th Kobo Touch on my blog here:
http://www.chaos8.com/wordpress/?p=201
It was generally positive and I compared it to the Kindle at one stage.
I didn't compare it to the Nook, as I've never seen or used the Nook, so I didn't see it as a fair comparison (The nook isn't available in the UK and will probably never get released here).
To quickly summarise my view on the Kobo Touch and what sold it to me:
It supports EPUB
It has a touch screen
It support external memory (MicroSD cards)
I would add it doesn't have lots of other fancy features that I don't want or need.
My Phone browses the web, so I don't want to use the KT browser (it's not that great anyway).
My phoe also has email, text, calendars, alarms and loads of other stuff as well.
I just want a dedicated ereader.