if I was going by your feature list, I'd be thinking about going straight for a Nexus One. If you are going to go Android, just go straight for the best. It doesn't have the physical keyboard, but great screen (and I personally don't care about real keyboard much at all).

Personally, I like the UI and app choice of the iPhone (iPhone app choice is ridiculously better than any other smartphone platform - I've seen numbers like iPhone having 98.4% of the smartphone app market). But if you are happy for a more minimalist app choice (probably more sensible, if less fun) Android is the winner

There is a free/FOSS eBook reader for Android, but it only supports un-DRMed mobipocket, but if you mostly use that format for reading Baen or something, you should be fine.