This rumor comes out before every Apple event.
Personally, if such a thing were true, I'd give my right arm for it!
And yes, I think it'd destroy the Kindle and like devices. I'm a big proponent of eInk and I love it and hate reading on an LCD like my laptop or my iphone, but if Apple came out with a tablet like that... most people are going to go for it. And I can't blame them, if it had a long enough battery life I'd probably switch too! Just the sheer of convenience of one device would overshadow the eInk aspect.
But aside from me... I think it would be a 'kindle killer' as most people would prefer an integrated device that isn't as good over a 400 dedicated eReader.
Dedicated eReaders are an endangered species from the getgo. Once tech comes out that can do a good job doing that and other things, it'll be over. And it's not THAT far off.
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