In addition to amazon and borrowing from the library, you can download books from anywhere and either transfer them to the Kindle from your computer or you can e-mail them to your Kindle from your computer. There's a small fee for the latter.
I did trade my Kindle in for an iPad (then iPad 2). I like the iPad much better because of the additional functionality and the fact that it is backlit. It's harder to read in bright sunlight than the Kindle but I'm more likely to read in the dark after my husband goes to sleep than in bright sunlight. I have the Kindle app so I didn't lose any books switching over.
I'm anxious to see what Amazon's tablet will be like. I've been reading good things about it on some of the tech blogs.