I had a Sony reader PRS-505 for a year then bought the new PRS-700 model.
The new model comes with a touch screen put over the letter screen, allowing to turn pages back and forth with swiping motion like iphone. As a result there are fewer buttons for control; a stylus is provided to highlight or search words and make notes.
A little drawback: The added layer of the touch screen causes the underlying letters to appear slightly foggy. However, unless you have a previous model next to the new one to compare, you wouldn't notice it. The appearance of the letters is still excellent. The new PRS 700 offers LED lights around the screen to allow reading in a dark environment. It is slightly thicker and comes in one color. (black). It can now take up to 8G SD card instead of 2G. The grey scale is 8; the resolution is 170 psi---no change from previous model. I upgraded to the new model after thinking about the slightly diminished appearance of the ink letters; I am very happy with the purchase.