I hear what your saying Sonist and DavidSpitzer. I've been salavating for a large screen eReader that supports PDF since the day I got my Kindle 1. There are some huge advantages to PDF -- see
Why I want a big screen ereader
On the other hand, there are also some advantages to ePub. The two biggest are probably the ability to resize fonts and then the text on the page seemlessly reflows. This is especially useful to us guys whose eyes aren't that great anymore. The second big advantage is that only a single file is needed for displaying on a multitude of different sized devices.
Sometimes I'd prefer a reflowable document. If I'm reading a novel, even when illustrated, I would strongly prefer something reflowable over a PDF document. In fact, I'd say that for most books I'd prefer ePub.
I suppose one could argue that Amazon already supports the mobi format and that is good enough. However, ePub is definately superior to mobi, and not including ePub support is tantamount to Microsoft not supporting the latest web standards and insisting that the HTML 3.0 standards are good enough.