Be careful of the Asus. If I remember correctly they are releasing two models and the one with duo screen is going to be more than $163. If you by an Ebook reader, you will probably want one that has access to an online bookstore. Both the Kindle and Sony readers do. The PlasticLogic reader, if it ever gets released, will be compatible with the Barnes & Noble online store and there are now rumors that B&N may even be coming out with their own reader, smaller than the PL one.
Currently all online bookstores use DRM. This means you cannot buy an Ebook for Amazon and use it on the Sony, and vice versa since they use different formats. You also cannot share books with other people but there are some exceptions. For example, with the Amazon store, you can have the same book on up to six devices but all devices must be registered under the same account. I believe Sony also lets you register up to six devices but I'm fairly certain the DRM restricts you from using a competitor's Ereader even if they accept the same format (e.g. Epub).
With virtually all readers, you can load and read public domain books. There are even several websites (e.g. manybooks.net) where the books can be downloaded in the format of your choice (e.g. .azw for the Kindle). This saves you the trouble of having to convert a book into your format or avoid sometimes weird formatting issues (justification, etc.).
I have a Kindle and I love it. The main reason I got it was to read public domain books although I have bought some from the Kindle store using Whispernet which is extremely convienent. With the current Sonys, you need to download and transfer all books and must use their PC software, although they are coming out with a WiFi model later this year. Also, some of the Sonys have a touchscreen which have had mixed reviews.
Regarding the Kindle, no you cannot borrow Ebooks from the library, mainly because it doesn't use the Epub format which is what many libraries use. Many people are hoping this will change although it is not known if this could be done via a software update on the Kindle. It would make sense for Amazon to add the Epub format though since Sony does and have made it their standard.
Finally, just some additional points on Ereaders. One of the advantages is that E-ink is easier on the eyes than an LCD screen, although some people can deal with reading on an LCD over an extened period of time better than others. Currently, all major Ereaders are grayscale. Color readers are still a ways away. A color E-ink reader has been released in Japan but it costs about $1000 and the color isn't nearly as vibrant or bright as LCD. E-ink readers also don't have backlighting, which many people are frustrated to find out after they make their purchase. Again, the technology isn't quite there yet. Sony tried releasing a reader that was lit by LED's from the sides but it was discontinued since the lighting made the screen harder to read.
If you'd like more info on the Kindle, let me know.
