I received a Kindle for my birthday last month, and ever since, I have had it with me quite a bit. I've read a number of books, online articles, downloaded articles/books (hello Gutenberg project!), personal documents, PDFs, and alternate ebook formats (e.g., text, Mobi). I've also viewed images, listened to music, played games, and listened to articles with the text-to-speech feature.
My first impression? AWESOME. This is one of the most useful devices I own, and it has helped me face a mounting task: to read that which I "should" read, including articles for work, research articles, random pages online, Wikipedia entries, classics I should have read in school, and simply books I've been meaning to read for a long time.
Further, the device is extremely useful for work. I don't have to print out long documents for meetings: I simply load them on to the Kindle. (I don't have the 3G version, which is fine by me. I don't want to pay extra fees for content delivery, and the USB cable is easy enough to tote to work where there's no WiFi.) I maintain a project list as a text file with current items on the first page and completed items on the second page. Once it fills up I plan to archive it for review purposes.
The capability to search, easily navigate a document, and have a document anywhere has been immensely useful, especially during critical moments in a meeting when someone says, "I think that's documented in that XYZ document that I've either printed out a 150-page version of and will take me 15 minutes to find or I did not print it or I left it at my desk, so none of us will know the answer until later." Just yesterday we were fumbling around trying to figure out the next date we should meet, when we should run a process, and when we should communicate by email or phone. I opened up a PDF calendar I loaded and it made planning much easier.
Of course, this could be done with just about any e-reader, right? Yes, but the Kindle has that iPod-like cool and ease-of-use. The ease-of-use is really the big advantage. The Kindle loads quickly, turns pages quickly (except in some PDFs, especially those with too many images), has an excellent organization method ("collections", where a book can be located in multiple collections), a "newspaper" feature with auto-archiving of old "editions", and all the other features I mentioned above. It's also comfortable to hold and it has the potential for more capabilities. For example, it has a microphone with no known current use, but I imagine that voice commands (e.g., "turn page") would be an excellent addition, especially for people with disabilities.
Even though people complain that it has a locked-down ebook format, so do the other e-readers, especially the Nook, which claims it doesn't. Barnes and Noble use a more open standard, but they still lock it down with DRM, making it practically inaccessible to other ereaders. And frankly, there are ways around these limitations, as any savvy computer geek can find a way to break DRM. (Hopefully, those people are being honest and not selling or distributing copies.)
Have I had any hiccups? Yes. First and foremost: DO NOT BUY THE NON-LIGHTED COVER BY AMAZON!!! Due to its construction, it causes the Kindle to short and restart, seemingly at random. It is not the Kindle. It is the cover! The lighted cover is fine, in fact, I exchanged the non-lighted cover for the lighted cover, and I haven't had any problems with it restarting since. (Caution: The lighted cover costs a bit more, almost half of the cost of the Kindle!)
Additionally, I've had some odd problems with PDFs. Sometimes viewing PDFs with a lot of images makes the page turns very slow. PDFs maintain the format, so they are often hard to read in the default orientation. Rotating the orientation to landscape helps with that problem. It's possible to load images onto the Kindle, which is a hidden, experimental feature. The images look similar to the screen savers, and are a bit slow to navigate as well. Simply put, it's not a device built for handling images (yet). So really not too many drawbacks directly related to the Kindle!
Overall, it's a great device. Easy to use, flexible, and quite frankly, beautiful. My wife says, "It's not beautiful - it's sexy." Please note: she said that, not me.