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I had a 505 prior to my T1 and have never regretted 'upgrading'. You may well be surprised and actually use the WiFi from time to time. Even if you're simply sat in McDonalds and fancy getting a book from your local library.
The processor is faster on a T1, so although you've gotten used to the time lag when changing pages (you may not even notice you press the button whilst still reading) its nice to have almost instant page turns.
The biggest benefit is, in my opinion, as a result of the changing of build materials. Plastic is lighter than metal, the T1 clearly feels lighter if you have it in your pocket.
The case issue isn't such a problem. I trialled a few before finding one I'm happy with (a nice nappa leather A-frame type). And although I realise that a lot of people see a reading light as an essential, I'm used to reading books without a reading light. I did that before I had my reader, and still do it now. If it's to dark to read, turn the light on! :P
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