So I'm a big believer in my Kindle, I love the thing and I think e-ink readers are the future. I read a lot, I like the feel of paper, but the convenience of having 200 books with me on a slim light device is unbeatable.
I also write on here and produce content, and keeping abreast of the various formats that can be published in is a bit of headache. But Alfred Pang does a great job explaining the current formats and tools to convert between them here - http://alfredpang.com/2010/11/minimalist-workday-in-epub-and-kindle-format/ -
What are all the formats for?
E-books can come in many different formats. ePub, Kindle (MOBI), text, HTML, PDF, Word documents, etc.
Independently produced ebooks (such as Minimalist Workday) usually comes as PDFs. The advantage is that PDFs print out onto paper very well and the exact formatting of the document will not change.
However, eReaders such as the Kindle is really designed to render flowing text, rather than images (which PDFs really are). The reading experience of PDFs on the Kindle is really dismal, but passable if there are no alternatives. A properly formatted Kindle book provides for a much better reading experience.
The rest of the post has details on what software he used, and samples of a work he converted to two formats. Useful stuff, I'd recommend you check out that entry if you're a Kindle user or publisher of any kind of written content.