Developing nations differ a lot in terms of their both their needs and capacity to support technology. For some, ereaders would clearly be inappropriate. For others, ereaders may be appropriate. Also keep in mind, the logistics of distributing physical books is much more difficult than carrying an SD card full of ebooks from community to community.

Anyone interested in this topic may be interested in digging up some stories from the OLPC (One Laptop Per Child) project, which tried to do much the same thing with inexpensive computers. (Granted, these were computers designed for their needs, rather than unreliable hand-me-downs.)