I have the Barnes and Noble eBook app on my iPod touch (it's a free app) and I have access to the same database of books. The format is fine, I don't need to be holding a book to get into the story. I like how compact it is and easy to carry with me, but when it comes to books, I'm really frugal. I hate the idea of spending up to $10/book when I have thousands of books at my fingertips in the library for free, or for a few bucks at a used book store, plus I already have hundreds of books at home and I get a lot of them free from
www.paperbackswap.com.
I've downloaded a few free ones from Barnes and Noble, but they're old books: The Last of the Mohicans and Sense and Sensability. I saw the Twilight books were cheap, I might download those
For the cost of the Nook you could get a 1st or 2nd generation iPod and get the reader plus everything else the iPod does, too.
I have a lot of music, a few movies that we got free digital copies for, pictures of my kids, a lot of games, email, my calender and appointments, contact information, google maps, internet radio, facebook, etc, etc.