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As someone who reads a lot of PDF technical ebooks and docs, and who has dodgy close up vision, an iPad size tablet is what works for me. PDFs on a 7 inch screen (of a type with lots of diagrams and images so reflow doesn't help much) just don't work for me.
Ditto web pages.
A 7 inch screen, or smaller even, is fine for text documents where I can increase font size.
The new Amazon tablet is aimed, it seems to me, squarely at US consumers buying from the Amazon ecosystem. The lack of 3G, the move away from the standard Android marketplace limits what it can do. And the lack of availability of movies and music outside North America and to some extent the UK limit it's international attractiveness. As it stands it's a different beast to the iPad. If I was in the US I think I'd still go for the iPad because of the range of apps that allow me to read/view media from a number of sources. Not to mention creative stuff like drawing and photo editing. And have an eink kindle for reading text type books, as e-ink is much better for non PDF reading.
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