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The Kindle has wireless for purchasing and downloading books. The Amazon ebook store is one of the largest out there and probably has more than enough content for your reading pleasure. Kindle also has a built-in dictionary for looking up words and there is a physical keyboard which makes the form factor a little larger than the other 6" devices.
Amazon tries to restrict you to buying books through their store. Any book you buy from Amazon cannot be read on any other device and cannot be shared unless a friend or relative also has a Kindle that is registered to the same account. You can purchase stores other than Amazon but they must either be DRM free or if they have DRM it will require removing the DRM before reading.
The Sony is a basic no-frills reader. It does not have a keyboard (except for 700) or dictionary or wireless for purchasing books. It has a smaller form factor compared to the Kindle.
Sony content can be purchased from their online store (smaller than Amazon) or from other retailers like Fictionwise or BooksonBoard. If you are in the US, ebooks borrowed from a local library can be read on the Sony. As with the Kindle, books purchased for the Sony cannot be read on the Kindle and sharing can only occur if another Sony device is registered to the same account. Books can be shared but the file has to be DRM free.
Each device has different file formats that can be used, but there are ways of either removing DRM or using programs to change the format of a particular book so it can be used on either device.
Ultimately your decision will depend on what you want to read, where you want to buy it from and what functionality you want to have in your reader.
If any of my information is incorrect or was not explained clearly, others will be around to clarify.
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