I like Kobo over Kindle just because it isn't a locked-in ecosystem and you can get books from other sources (e.g. Google Play, various smaller outfits). But I don't think you can really go wrong with either. There are ways to convert between epub (used by Kobo and others) and Kindle format but if the book has DRM you have to remove it first. I have done that on occasion if there's a really good deal on a book I want at Amazon that isn't matched elsewhere, or for books that are published by Amazon and exclusive there, but a lot of deals these days are the same at all the major stores.
There are lots of (legal) free books available for ereaders. For example Tor, one of the major sci-fi/fantasy publishers, has been giving away a free book each month if you sign up for their newsletter; these are relatively recent books by well-known authors, often but not always the first book in a series. I've probably got more free books than I'll actually ever get a chance to read.
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