How I spent the last 10 minutes.
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Just installed and bought a book. Heading to the bathroom now.
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Success! It works like a charm.
(You dont need to buy a kindle)
Reader is decent. Font size is nice. Bookmark feature works. Option to choose the font you like.
You have to buy books from web browser at amazon.com/kindlestore. But it will automatically send it to your iphone kindle app.
Next update (free) may include searching/buying directly from kindle app. But really what is the point? You probably want to use amazon.com/kindlestore to search and browse for new books anyway.
Also the book I purchased is pretty good. A couple "duh" things and a few "doh! Why didn't I think of that" things.
http://www.amazon.com/Upgrade-Your-Life-Lifehacker-Working/dp/B001B1RXOS/ref=sr_1_12?ie=UTF8&s=digital-text&qid=1236190390&sr=1-12