Personally, I think pictures don't do the Kindle justice...maybe because its not as clunky as it appears. In fact, as a reader, I think most of the design makes a lot of sense. I would take functional over looks...but again, I bought a fugly Cowon PMP over the sleeker iPod.
When I look at the pictures of the supposed Kindle 2.0, I don't see anything that would tempt me to upgrade. I'd like to think that what we are seeing is a no-frills model that sells for much less. That's what the ebook market needs to make it more mainstream. Take away the web browser (keep Whispernet for the store only), no SD card, no audio, no removable battery and sell it for $199 (one can wish, right?). Personally, I would like to see more done to move eReaders to the mainstream (Amazon's content/pricing being a strong first step).
Admittedly, even before today's posts, I got worried when the ship period jumped from "by Christmas" to "early February" overnight. It made me wonder if Amazon had hoped to have produced enough Kindles for the holidays and was phasing out production for a newer model...and got caught short.
I hope that any software enhancements get pushed down or they will have some unhappy Kindle 1.0 users.