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I have both: I got the K1 a few months after it came out (missed the price drop by about 5 weeks) and then won the K2 in the generous Mobileread giveaway not quite a year later, (if I recall correctly.)
They both have good points. I like the more convenient interface the K2 "joystick" makes possible--many things that required 2 menu selections with the K1 can be done with one on the K2--and the K2 is slightly faster to turn pages. But I like the K1's user replaceable battery (for peace of mind--if the battery goes south you can get a new one for 20$) and SD card (effectively unlimited storage space and the potential to organize books by card), which the K2 doesn't have.
If the money is burning a hole in your pocket and it's important to you to have the latest (or sleekest) version, or if the K1's quirky page turn buttons and roller are driving you mad, by all means buy the K2; it's a fine liseuse. But if money is tight and you don't mind having version one, stick with the K1. Because 99% of what you'll do with it is read, and for reading the two are pretty much the same.
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