iPad isn't out yet so I haven't seen any reviews of it from an eBook reader point of view. It supports ePub so in theory you should be able to read anything in that format from other stores, but a closed platform and book publishers being involved don't inspire confidence that that'll be the case.
I'm basically in the same boat.. If it makes a difference I've seen the 5" screen Sony reader on dell.ca (smaller screen, but more portable too) for $200 a few weeks ago.
http://www.coolreaders.com/default.asp
These are some more that I've been considering, they were supposed to be launching new models after CES but I haven't seen them on their site yet.
http://booredatwork.com/2010/01/20/c...read-ces-2010/