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I have both the K2 and PRS-505 and let me tell you, having the ability to have collection folders is priceless! I have 280 books on my PRS-505 (it's 13 pages of books but only 3 pages with collection and I still have more room on page 3). Not only is it great for organizing series (I have the Lora Leigh Breed series - 19 books in one folder in order and Sherrilyn Kenyon Dark Hunters series - 28 books in another folder). I don't have to search for which book to read in that series since each series are in chronological order in a folder. I have not touched my K2 for reading in over 2 months, all because of organization and page numbers. The 2 things that makes my PRS-505 a better reading experience. I was going to upgrade to the PRS-600 and then Sony announced the PRS-900 (which is still the same size as the K2 even though the screen is an inch bigger due to the keyboard) and since I use my readers a 100% for pleasure reading, that will be my next upgrade for my primary reader. Not that I'm not enjoying having both the K2 and PRS-505, even though I'm not using the K2 to read, I do use the Amazon store to buy books! I have no urge to buy a Nook (0%), from my personal experience, these 2 readers meets all my needs.
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