Kris,

I don't believe that the 700 is a good example. I think it was designed incorrectly by introducing 2 things at the same time: the front light and the anti-reflection, diffused touch screen. The introduction of the light forced Sony to put the touch screen further away from the e-ink surface. Because it was diffused, the further away it is, the more blurry the text will become. In addition the type of diffusion used did not reduce the reflections but only spread them out over a larger area.

One does wonder what the 700 could have been if they had done the touch screen right. As for the light I don't really think a built in one is necessary as there are better alternatives without the compromises. From what I've read the iRex products have a touch screen but do not suffer the same ill effects as the 700.