The Nook Glowlight seems to be the overall best e-ink Reader currently. The Kindle will get the glowlight within the next 6 months.
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As a bit of an e-book reader addict (read: I or family own most of the devices of the category), I'd say that at the moment, the choice is more or less obvious if, and this is a big if, you are really interested in using the device for reading books. If so, then you're best off with an e-ink device, which will minimize eye strain and last weeks/months (depending on how much you read) without a charge. Since your budget is good, you should go for a market-leading device, so I'd say either Kindle Touch (with ads, no need to pay premium for no-ads as they're not intrusive) or Nook Simple Touch. A few months ago, I'd have said 'choose either', but given the release of the NST with GlowLight, it's the obviously superior option. You'll be able to have beautiful crisp text in bright sunlight or in bed, without the eye-strain of LCD screens and with incredible battery life. It's definitely the top choice if you can justify the price.
So, remember the big IF, as in, what if you don't want to just read? Well then, you're best off going for a "budget" tablet then. A lot of people would probably recommend the Fire given your budget and how Amazon-integrated it is, but I'd say the better pick would be the 7-inch Samsung Galaxy 2 Tab, which retails for $250 and you can regularly find between $200-225 if you watch SlickDeals. The difference is that the Galaxy Tab allows you to install any apps you want without rooting (your choice of magazine readers, kindle, nook, kobo apps, etc.) and is a much speedier device that runs Google's latest OS, Ice Cream Sandwich.
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