It arrived today. I'll narrate with photos:

Cute box.

Web browser. Its slow, but its usable for pulling up news sites and weather. The refresh rate of the e-ink is pretty quick. Where it starts to chug is rendering. The 533MHz processor ought to be enough, but the software is terribly unrefined.

Its well made, light, and pretty. There are stereo speakers, which seems silly. It also seems silly that 3G data service is included for free but wifi is omitted.

Its reasonable to type on, like a large mobile phone.

Images look crisp. Kindle 2 gets a 16-level grayscale display, a vast improvement over Kindle 1.

The browser has an advanced and basic mode. This is usatoday.com in advanced mode. It looks like Netscape 2.0 tried to render it. The page was retrieved in reasonable time but the device chugged and chugged and chugged. Again, the e-ink refresh rate wasn't the issue since PDFs appear quickly. Its the software.

Handy list of bookmarks. If you happen to be reading a newspaper article (they charge for automatically delivered newspaper subscriptions) and want more info, you can look it up on the device itself. That's the only situation where I can really imagine needing web access on the Kindle.

E-ink is really pretty. Its very comfortable to read, but I never have eye strain problems with LCD displays anyway. I grew up on Sega Game Gear after all.

If you leave it sitting long enough or hit the power switch, it displays a portrait of an author, a relaxing scene, or some book-related theme.

A simple USB cable and USB wall charger.

This is the BMW 5-series service manual in PDF. The Kindle is unable to zoom or pan or adjust contrast, so its barely readable. The images in this example actually look pretty usable, but the text is blurry and faded. Switching to landscape mode helps a little bit. This is pretty pathetic for a device designed for reading documents and books.

I converted some Ayn Rand books from PDF to MOBI using a free program called Calibre. Calibre tries to be the iTunes of e-books, organizing your books, sorting them, and converting them to one of a dozen supported formats. Since Calibre was able to recognize the raw text in the PDF, it looks really nice. The delay when going from page to page is very brief. The pacing is natural, faster than turning a real page.
It locked up on me right at this point. I had to reset it by holding the power button down for 15 seconds and waiting a couple minutes for it to reboot.

This is Calibre, available for Windows, Mac, and Linux. Its a bit crude but it gets the job done.
The Kindle also does text to speech which is crisp and clear thanks to two speakers. The two voices, male and female, sound terribly generic, so dont expect it to magically turn your $10 books into $50 audio books. Its sufficient enough to get the job done, but I'd only use it for articles and documents rather than entire novels.
Kindle plays MP3s too, poorly. It sounds nice, but there are no on-screen controls. You copy the MP3s via USB, choose "play mp3" from the "Experimental" menu, and it plays through all of the files in order. There is no random, no shuffle, no artist/title info, no music store. You hit Alt+F to switch to the next song or Alt+Space to pause. To unpause, you have to go back to the home page, hit the Menu button, choose Experimental, and choose "Play MP3" again. It really is an experimental function, implemented very poorly.
Overall, the Kindle does one thing well: Reading text-based books. It does everything else crudely and poorly. The hardware is capable of doing a lot, but Amazon's software feels like an early release. Version 2.3 makes me wonder how awful Version 1.0 was.
As a document reader: 3/5 (support only for PDF, AMZ, MOBI, and TXT. Not very versatile or capable, but what its capable of viewing is easy on the eyes and flips forward quickly.
As a music player: 1/5 (Pathetic)
As a web device: 1/5 (One point for free unlimited 3G if you're really desperate)
As an Amazon book reader: 4/5
Overall: 2.5/5
I do intend to read lots of books that I've missed out on because I hate the physical paper format of books, so as long as I stick to the tasks the device was intended for, I should be reasonably satisfied. Otherwise, I can still sell it for about what I paid (if not more) since I got $40 off through Woot.
At $150, its only $50 more than a Sony E-reader that has far fewer features (though the Sony does have a backlight). I feel sorry for all of the people who paid over $300 -- the Kindle's software needs a lot of work before I can recommend it to others, but I can enjoy it for what it is.