I'm a huge, huge fan of eBook readers and I've been for a very long time. I've also owned quite a lot of them over the years (I bought a
REB 1100 about ten years ago in fact, talk about early adoption

).
I own two readers from Sony: the
PRS-505 and their new, touch-screen enabled
PRS-600.
I bought the PRS-600 to replace my 505, part of the screen substrate broke when I moved back in July, and the 505 was discontinued so I got a 600. As a hardcore reader of eBooks, I regret my choice slightly. Like AkG mentionned, to make the touch screen work, they had to add a thin layer on top of the e-ink display. This layer is very thin, but unfortunately it reflects light somewhat. It's not too bad mind you (not as bad as with the
PRS-700, but still annoying). If you have a light source right behind you, it is very noticeable.
I also find that I don't use the touch screen very much. The device is for reading after all, and the slow refresh rate on e-ink panels means it's fairly poor at reacting to input and such. About the only thing one might use is the dictionnary (I think I used it once or twice on a China Miéville novel

).
Now, for the strong point of sony devices in general. Everything I say here is good for both devices.
- The format support is very, very good. You can drop HTML files, ePub (with or without DRM), PDF, RTF, LIT, TXT and Sony's LRF and LRX formats. I think it might support one or two other formats but those are the ones I've used.
- The battery lasts about two books (a book being ~350 paperback pages for me) before it needs to be recharged. It only comes with a USB cable for charging, but you can get a PSP charger for a few bucks that works perfectly.
- Very strong open source software support : Calibre is an open-source software that will sort, convert and generally manage your library for you. It will also automatically sync to your Sony device and generally kicks ass. It's so good you can just get a random .rar file containing a book and drop it there and basically click "put it on my eBook reader", and it will automatically extract the archive, convert the book (even if it's say, a HTML book split in 55 files, or a .lit or whatever) and upload it to the reader. It is *awesome*.
- PDF support is very good, with pan and zoom. However, what worked best for me was using a small executable called PDFLRFWin (you can find links on the mobileread forums). What it does is render the PDF file, remove all margins, then turns in 90 degrees and splits every page in two. You have to use your device side-ways to read the book, but with the margins removed, the format is large enough to read without zooming, while preserving 100% of the PDF formatting with all pictures and tables and whatnot. I was able to save a lot of time reading PDF books in the subway/bus to get my MCSE and Cisco CCNP certifications.
Overall, very good devices, though I wish they still made a 6" version without touch screen. If you don't mind losing 1/3 of screen space, you can get the pocket version with the 5" screen. It still has the non-touch goodness, but reading PDF on it without zooming might be hard.
Also consider getting an international version of the Kindle. It's not as open, but it's got wi-fi and a non reflective screen (though not as good as the PRS-505, *sigh*). Also buying books from Amazon is generally cheaper than at the Sony store.
Obviously, e-ink devices are rather fragile which is their big flaw, along with fairly slow refresh rates. If you can find a good deal on a used PRS-505, this is *the* device to beat. Otherwise, you have plenty of choice but the Sony ons are probably the best overall (imo).
If you want more opinions, go to the mobileread forums. The users there are generally not afraid of giving out bad reviews, even though they are avid eBook readers. For example, they totally blasted the PRS-700 for its glare when it came out, which probably saved me from buying one, as I was ready to order without having seen it (who could have thought they would put out something like this after the godly 505?

).
Hope this helped you a bit.