I have both a Kindle 2 and a nook. I prefer to read on my K2 for the following two reasons:
The dictionary. On the Kindle, you simply move the little joystick to the word, and the definition shows up at the bottom of the screen. With nook, you need to wake up the touch screen, scroll down to Look Up Word, use the little touchpad arrows to move to the word, then click OK on the touch screen. The definition (if the nook dictionary can even locate it) replaces the text on the screen, which takes a few seconds. Then you have to cancel out of it on the touchscreen to go back to the page text.
Reading more than one book at a time. Flipping back and forth from one book to another on the Kindle is very easy. If you keep your menu sorted by date, the books you are reading are right at the top of the first page. A quick push of the menu button, and a little movement with the joystick, and you are on the other book. With nook, you have to use the touchscreen to back out of your book, and go back to your Library. If the other book you want to open is not in the same library (B&N vs. My Documents) you need to choose the other library.
I find the Kindle easier to navigate than the nook, with the dedicated buttons. The nook touchscreen neither registers every touch, nor are all of the icons/buttons large enough that you can make sure you are touching exactly the function you want to use. I particularly have trouble when scrolling through a list, as I often end up clicking on a menu option instead.
However, my nook has worked well since I received it at Christmas. I actually now have more books for my nook than I do for my year-old Kindle. Fictionwise can be a horrible addiction, with its odd pricing structure and rebates and coupons. This weekend I spent another ~$100 there after I received a 15% off coupon, and I picked up another ~$100 of books using up some of my rebates. So, while I prefer reading my Kindle, I spend about 50% of my reading time on my nook. I just avoid looking up words since it takes so long, and I only read one book at a time on my nook so I don't have to use the touchscreen to move back and forth between books.
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