When it comes to just reading text, I much prefer my Kindle. I know a lot of people say they don't notice any eye strain when reading from the iPad, but boy I sure do. Especially if I'm already tired. Now, admittedly, I will gladly spend several hours reading a good novel at one sitting, so I might not be a representative sample.
But, here's where things get interesting. I tend to read four things: novels, computer books research papers, and pen and paper RPGs. Of these, only the novel plays nice with the Kindle. The Mobi ebook format just doesn't handle the formatted text well. Yes, several computer book publishers have worked very hard to make Kindle compatible versions of their books, but the end result always feels a lot clunkier than either their epub or PDF equivalents. And many books (not to mention all research papers and RPGs) are only available in PDF. The less said about the Kindle's PDF support, the better.
With the help of some third party apps, the iPad can easily handle all three common ebook formats. It may not be the best ebook reader, but it is the one reader to rule them all. So, while I may prefer to read on my Kindle, I think I may find myself spending more and more time reading on the iPad.