Launching at $250, the Nook Color, a new e-book reader from America's largest book retailer, Barnes & Noble, is an interesting proposition.  It lacks apps, but otherwise offers most of the features of a tablet, albeit crippled to various degrees.  The 7" E-Book Reader's closest competitors are the Samsung Galaxy Tab and Apple iPad -- the latter of which sells for $399 in 3G form on Sprint, and the former of which sells for $499 in Wi-Fi form/$629 in 3G form on AT&T.

The device just started shipping and the early reviews have come in.

Hardware

The Nook Color packs a 7-inch 1024x600 in-plane switching (IPS) LCD display.  IPS have been around since 1996 when Hitachi invented them.  Many argue that IPS displays are harder to read that E Ink displays, such as the display in the Kindle and the original Nook.  Part of this is due to increased reflectivity.  

Versus a traditional tablet like the iPad, Barnes & Noble has employed a new full-lamination tech called "VividView" which decrease unglued areas that catch light and cause glare.  Reviews at Gizmodo and Engadget both complain, though, that the glare is worse than traditional e-book readers.

Inside, the Nook Color is powered by a TI OMAP 3621 CPU clocked at 800MHz, 512 MB of RAM, and 802.11b/g/n WiFi.  There's no 3G.  There is 8GB of flash storage, a microSD slot, micro-USB connector, and 3.5mm headphone jack.

The device is slightly thicker than the Galaxy Tab (0.48-inches, versus 0.472-inches), and weighs slightly more (1 lb versus 0.84 lb).

Battery is 8 hours without Wi-Fi.  That comes partially thanks to a light sensor that dims the screen when its under light.

The Nook Color's big secret is that it is Android device.  Hidden inside it is Android 2.1 ("Eclair").

Software

While magazines and newspapers are reportedly inferior to a 10" format, due to size issues, the tablet reportedly handles e-books better than the iPad or Tab.  Gizmodo writes, "[I]t's arguably the first seven-inch device that's been designed to be one from the beginning, rather than a puffed-up phone."

However, problems also abound.  The music player is reportedly hard to use and doesn't automatically recognize newly added songs until you reset.  The web browser doesn't support pinch-zoom and breaks on many sites (including those that use Flash).

Supported audio and video formats are limited.  The device can play movies on YouTube -- but only at the lowest resolution.

Reviewers praised the inclusion of an Microsoft Office-document viewer (.ppt, .doc), which was a bit slow but got the job done.  They also said the PDF reader was superb.

Despite being an Android tablet, the Nook Color does not support the Android Market.  Reviewers were baffled by this.  Engadget recalls playing Angry Birds seamlessly on a demo unit.  Clearly this would have multiplied the value of the tablet greatly, but perhaps Barnes & Noble was afraid of muddling a cohesive e-book reader experience.  Whatever the justification, the reviews agree that the lack of apps greatly hurt the device.

Conclusion

The Nook Color is a jack of all trades and master of none.  Its also unbeatable at its price point -- because there are no other tablets at its price point.  Thus the value of the device is quite debatable.

You could say that the Nook Color represents the rise of the long-awaited budget Android tablets.  On the other hand, its software is reportedly so crippled that certain activities become painful.  At the end of the day, if your main goal is to read books digitally the Kindle (or original Nook), seems a better buy.  If you have $500, the Galaxy Tab would be a better buy.  But if you only have $250 and you have to have a tablet, the Nook Color is really the only solution out there, so it's your best bet for now.