just got a nook for my MIL but wish we had gotten the nook color...$50 more but it's like having a computer....checks emails, downloads pics, and it has 8GB of memory. It was $249. Not my thing but she loves it. She is also legally blind in one eye and you can change the font so it is really big.
My mom got a Kindle from my uncle for Christmas, the WiFi, 3g whatever, whatever. She's enjoying it very much. I have a friend who loves her Nook, not the color one. I can't tell you if one is better than the other. It's all a little over my head how they work beyond downloading books and reading them.
We purchased a Kindle about a month ago, I haven't had a chance to use it yet, DW won't put it down. The Kindle steers you toward Amazon for book purchases, but DW figured out how to download books from other sites.
We were going to buy a Sony E-reader at Fry's, but the salesman said that the Kindle would be a better buy; really appreciated his honesty. We got it at Target, since Fry's doesn't sell Kindles.
It can download some games also, but that's something we don't really care about.