Yeah, the limits are that it sucks.
E-ink is too slow, lacks color. The processor is slow, pages load slow, the screen ratio is terrible for the internet (don't think you can browse in landscape mode--at least not on th K1, maybe K2 and DX are different) etc.
You can look up something on wikipedia, maybe check g-mail etc. but that's about it.
The only real use of it is the Kindle store and getting books wirelessly. And I still do all my book buying on a computer, so the only real benefit is the automated download vs. having to plug into the computer.