IMO the e-book reader and the iPad will follow different paths to different customers.
The iPad screen cannot be read in daylight, a major failing for an e-book reader.

I recently returned from a trip to Central America where there was an abundance of e-book readers. The most common use was to read US newspapers that were delivered each day via internet. Personally I won't consider one until the DRM issues are settled. No one wants to lose the content they've purchased because a DRM server goes dark as happened last year.