When they went from the K2 to the K3, the biggest loss was the number row, which is now gone from the keyboard; you have to type numbers with the Symbol panel or with Alt+a letter. We also lost the title of the book as a header; which gives a bigger reading area, but I liked having the book title (and the battery strength) in the header while I was reading. I can make it show temporarily by pressing menu but I can't make it stay.
Aside from what's different, there are some things that are exactly the same on the Kindle 3 as they were on the Kindle 2, that I was hoping would be better. Most of them have to do with the robot voice in the text-to-speech feature. This function is really handy; it upset publishers when Kindle 2 came out with it (although for some reason I have not heard a peep of protest about it being in iBooks), but I don't see why they're worried. The robot voice reading is so not a real audiobook! Unless you have no other way to "read" a book, you probably wouldn't want to listen to a whole book read aloud in this way. The male voice sounds a tad like Stephen Hawking and the woman sounds like an automated teller ("your account has ... thirty-seven dollars-and . . . twenty-two cents.").
Some of the limitations are understandable. English is full of hertonyms, so I can see where it would be nearly impossible for the robot to know whether to say bowed (as when a person bends at the waist) or bowed (as when someone ran a bow across a violin).
Likewise I can where Roman numerals in text are problematic. Henry V is read as Henry Vee, not Henry the Fifth. Making it not do that would be tricky, and unless you're reading European history, it's not going to come up that much. Ditto encountering sounds rather than words, like "mmm" (read as M M M) and "Shhh!" (read as S H H H).
But I don't understand why the Kindle robot can't figure out that it needs to pause after a question mark or exclamation mark. When it reads a sentence that ends in a period (a full stop, for you Brits), it pauses, but when it reads a sentence that ends in a question mark, it doesn't, so:
"Are you hungry?"
Comes out as: Are you hungry no
And this is in spite of the fact that the robot actually does have a bit of rising inflection when it encounters a question mark, so the question does sound like a question. It also doesn't pause for em dashes, although it does for two hyphens.
Also, the default reading speed is about right, and the slower setting is understandable, but the faster setting is comically fast (imagine Stephen Hawking on speed!). I don't see why there can't be more than three settings.
And finally, although they added social networking, so I can what other folks highlight, or tweet my highlights (like I needed that!) there is still no easy way to let Amazon know when a book has bad formatting. It would be nice if that was a menu option!
So, officially, my Kindle wishlist is:
1) Restore the number row or at least print the numbers on or above the Alt+letter keys
2) Make the batter user-changeable, or at least give me a place to get it changed while I wait, like a watch
3) Provide a toggle key to show/hide the book title in the header
4) Provide an easy interface to report problems with the book
5) Make the robot voice better about punctuation
6) Offer a sliding scale of reading speeds
Oh, did I leave out the part where it only cost $49? -) (I'm sure the day will come but don't hold your breath)