I think Pugwash is on the money with this.
I thought the iPhone looked like a rubbish 'phone', but all the apps hadn't been written yet. Now it does things that didn't exist before it.
I reckon this is aiming at doing to books and magazines what iTunes did to music, plus ramp up video sales while they're at it. If you think this is 'meh', Kindle's going to look seriously piss poor.
Definitely there are some weird things that they'll inevitably sort out. I really don't get the flash thing, I thought it was related to processing power on the iPhone / iPod.
Anyway, Stephen Fry says it's good, and there's about 0.00001% chance of him being wrong.
It'll be interesting to see how it pans out.
And once they jailbreak it - it'll be even better.