We originally had the kindle with the 3g and keyboard. The keyboard makes typing easy. However, I find it hard to scroll through websites and lists since you can only use the four directional keys. The 3g means that internet is always available, which is a plus. I will admit that when the ink layer changes it makes me feel a little sick to my stomach. The screen is glare free but you need to buy a light to accompany it to read at night.
I purchased the nook color not long after having the kindle in my life. It works like a tablet computer. You can have music, pictures, apps, books and magazines on this device. The nook even reads children's books out loud. I prefer the search options on the nook since I am able to see the covers of the books. I sometime cannot remember the exact name of the book and the cover always helps me find it. The magazine subscriptions are reasonably priced and are beautiful to look at. Another advantage is you can download e-pub books for free from you local library and read for free. The screen can have glare in the sun, but most people like myself will purchase a screen guard for the touch screen. The major disadvantage is that you must be in range of internet in order to download new books.
Overall, I prefer the nook. I cannot comment on the new versions of either, but you can look at the lists below and make the decision for yourself.
Kindle Nook_______________________________
Black and White Color
Keyboard Touch screen keyboard
Scrolling using directionals Touch scrolling
3g wireless available Must be in internet range
No glare Needs screen/glare protector
Needs light to read at night Back lit
Cannot download from libraries Free books from library
Magazines
Apps
Pictures
Music
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