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Yeah, don't expect the Kindle 2 (or any ereader, really) to be the repository of your entire library. They're made to carry what you want, not necessarily everything you own. 1000 books isn't really a lot of space, and may easily fit on the Kindle 2's 2gb internal memory, depending on how big the files are. Storing them on CD/DVD, thumbdrive or other removable media is what many people with large collections they want to keep do.
Two problems I see that you may run into though: The Kindle 2 doesn't do .PDF's very well, more of a 'if you can get them to work' type of deal, and that's one of the formats you mentioned. The other is with the organization of that many books. There's no categories or folders to use on a Kindle 2, so if you put a bunch of books on it, it's a in a directory with a bunch of books, and they can't be broken down or organized. So, if you've got 1000 books on it, you have to sort through those 1000 books to find the one you're looking for.
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