There's a lot of stuff out there. Of course the Ipad, but, as cool as it is, the 500 dollar starting price is a deterrant to many.
There's the Kindle and Nook - which can't really surf but you can read, but there are the issues of propriatary formats (we tried the nook but took it back, largely cause it annoyed me that i needed to give them a credit card number to even turn the machine on, it won't work if you don't register and you can't even download library books without a credit card number...i was able to download library stuff and then transfer them to the nook, which was the work around)
there are also things like the Archos tablets, for those looking more to surf and watch movies than necessarily read. I have had really bad luck with an archos 5 tablet, so i plan to totally avoid them, yet best buy has plenty of others, such as Velocity Micro - android based, and others coming out by the day.
If all you want is PDF functionality, the e-readers might work for you. but if you want movies and surfing and music, then i'd suggest a tablet PC. You can still keep the e-reading since, to the best of my knowledge, Nook, Kindle, Kobo (borders online store) all have apple and android apps....so you can have your tablet pc that also interfaces with the e-reader store.
One thing to look for is touch screens vs resisitve touch screens. Touch is literally that. Think an Ipod Touch. it needs your finger's touch to manipulate. Resisitve screens are two thin layers that must touch each other for the action to be acnowledged, and usually need a fingernail or stylus to work.
pros and cons for each and depends on a person's preferences.
I lust after an IPad, but just can't justify the price for what is in essence a toy. Especially since I already have a Touch. I am however looking at various 2-300 dollar tablet PC's, that can allow me to surf adn read and still allow me online time.
I think it all boils down to what you want or need it to do.
For IPad 2.0, i would love to see it have memory card plug in ability (hard wired, not as a 100 dollar accessory). I'd love to transfer stuff to and from it without having to access itunes (which i usually end up having crash on my PC at least once a week with my Touch) or go through literally having to e-mail things to myself to get them to the PC.
A matte screen would also be nice. It would certainly cut down on the glare that plagues some table pc's.