lol, I've seen and played with the Zune quite a few times, but haven't done much else since it's at the store. I personally don't like the whole brick/cludginess of the device, who did M$ get to design the case? Hummer? The screen size blows the iPod away, but I've heard unconfirmed rumors of Apple coming out with a full-face screen in the near-term. The Zune is also a bit heftier & bulkier in thickness, but has some neat features like wirelessly sharing your music/videos with people in your PAN (personal area network).
All in all, for reading eBooks I'd stick with my PDA if my Reader ever kicked the bucket (at least for a short time until I got it replaced!).