Funny, nobody mentioned the iPhone yet
It's screen is amazing, and with Stanza, eReader or Bookshelf I now consider it a perfect ereading device.
Unfortunately, the only iPhone in our house is my wife's
Newer S60 devices (3rd edition) can't run mobipocket. Also, most S60 devices are non-touch-screen, so if you install a dictionary etc. it'll be cumbersome to use.
I love reading on my Sonyericsson P1i, especially the scroll-wheel is a big bonus. Screen-clicking is okay, but not as comfy when reading one-handed.
My personal opinion is to stay away from windows mobile based devices, since all of them that I or my family and friends used had or have major issues with one thing or another. The perfectest, most trouble-free phone is the iPhone, in my experience ... but we're all mac users so maybe that is helpful.
The p1i is a good phone, but it's rather slow when switching from contacts to messages to call list etc, so I can't wait to get the snazzy iPhone.
Did I mention I'd suggest the iPhone
Anyhow, my 2 eurocents.