The idea of reading a book on an "ebook reader" has appealed to me since the late 90s, when e-books first showed up. Unfortunately portable technology for reading the e-books was years away. The Kindle (2007, $399 yikes!) was a step in the right direction. Good battery life, lightweight, and the ability to read in bright sunlight were three of its strong suites. The problem is that, like a regular book, it required a good amount of exterior light to minimize eye strain, and even then it was not particularly bright. The price was outrageous, and it is hard to believe how much the price has dropped on these things, with the iPad (2010) being the catalyst to improve what one could buy for several hundred dollars.
The Kindle Fire ($199, 2011) tablet, not to mention the other tablets in the tablet craze that began with the release of the iPad, was another way to read ebooks, but I quickly abandoned it due to several problems. First, the glass makes it too heavy. Second, and more damning, the glass results in a lot of glare, making it difficult to read outdoors and in lighting conditions not under your control. Third, the Fire is plenty bright, sometimes too bright. That brightness can lead to eye strain, particularly in dim lighting conditions.
In 2012 Kindle released the Paperwhite. This is a breakthrough in e-reading. It addresses all three problems that I had with the Fire. It does not have the heavy glass, so it is very light. The surface has practically no problem with glare. The screen, at the highest setting, is very bright and is just about perfect for reading in a well lit room or in bright sunlight outside. I wrote "setting" because the Paperwhite allows you to change how much the screen is lit. I use the highest setting for outdoors, a middle setting for indoors, and a low setting for a dark room/complete darkness. While it is possible to read in complete darkness, it is not preferable due to eye strain even at the lowest setting. That said, I still read in the dark a lot, right before falling asleep. Keep in mind that I have had Lasik, so my eyes might be a little more sensitive to light than the average person. Another thing to note is that I have a first generation Paperwhite. The second generation Paperwhite is advertised with higher contrast, so it might be a little better in low light conditions.
There are a few drawbacks to the Paperwhite. Many people have reported uneven lighting on their Paperwhite. Usually this is limited to the very bottom of the screen, meaning that it is still perfectly readable, but the lighting is not perfectly uniform. I have a "perfect" Paperwhite, but it is really the luck of the draw. Maybe Amazon has had more luck in the manufacturing process with its second generation Paperwhite.
I would like a larger Paperwhite. A 7" version would be just about perfect. Right now I find myself wishing for larger font, but when I increase the font size, the words per line decrease too much. This is one of the few advantage the Fire has over the Paperwhite.
Another aspect that could be improved is the built-in software/firmware, which could stand to be overhauled to make navigation between books easier. Not that is is difficult, but I would like something more user friendly, e.g. Apple-esque.
While I would prefer buttons on the side of the Paperwhite to turn pages, using the touchscreen is works good enough, with room for improvement. I have read that the touch interface is improved for the second generation.
If you have a lot of e-books, you really need to download a library software like Calibre to your computer. It makes conversion and transfer very simple, and of course it sensibly organizes your collection.
At this point, I would recommend waiting for the third generation Paperwhite, which should be released in the fourth quarter 2014 at the latest.
Update-This article does a decent job summarizing most of what I wrote previously.