I didn't think I would like a touch screen reader. But I got the Sony Reader WiFi and I LOVE it. It is an excellent reader. I love having both page turn buttons and the ability to turn them via the touch screen. I have over 2000 books on it and no problems whatsoever. Wish I could say that about my Kindles.
As for the Kindle Fire, YES it is good to read on! I LOVE it! It is the coolest little thing. The "other stuff" is nice too. But for ereader, YES. and I was so sure I would say NO. I do NOT like reading on my kids' Nook Color. But the Fire is better! It is definitely a great ereader!
Best to have one of each, as the Fire doesn't have a long battery life, and not too good outside.