I have a first gen Kindle and it's still rockin'! I LOOOOOOVE my Kindle.
Let me first start off saying that a Kindle is MUCH different from an ipod, ipad, and things like that. It has "e-ink" which means it has NO backlighting. I HATE reading with backlighting like on a computer and those other things. It's straining on the eyes and pretty much CRAP for avid readers. I would stick with a Kindle or a Nook, but NOT a Nook Color as it has backlighting again (who the heck thought/thinks backlighting is a good idea?!)
Anyway, there are SEVERAL books for the Kindle that are free and instantly available to add to your Kindle. Now, one advantage that the Nook has (from what I read) was that you can get library books for free with it. BUT, from what I've heard, the Kindle will have that ability soon.
If you have anymore questions, just let me know!