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The 650 has an SD expansion slot, the 350 doesn't. They both have the same base memory though and will hold the same amount not counting the expansion card.
The 650 can play some audio formats and has a headphone jack, the 350 doesn't, it's strictly a reader.
The 650 is a 6" screen, the 350 is a 5" screen. They both have the infrared touch screen. Neither has wi-fi, you need to sideload your books.
None of those points are an issue for me. I use my reader strictly for reading and have a very tiny mp3 player if I want to listen to music or audio books, no need to carry around the reader then. And the base memory is enough to carry around up to 1200 ebooks, more than I'd ever need.
For myself, I love the smaller 350. Since it fits into just about any pocket, I take it with just about every time I leave the house. Those who have both the 650 and 350 say the screen looks sharper on the 350 since they're both 800x600 res, but it's packed into a bit smaller screen, so it seems to appear darker text.
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