Nah, don't have to re-buy your books. Just have to download them again to your device, which can take a while depending on how many books you have. I love the iPad, hate iTunes. But the good thing about iTunes is that it'll back up your purchased apps.
For myself, I'd much rather have a device that will do a multitude of things instead of a dedicated reader. Even with my first generation iPad, I know I can get several years of use out of it before it really is obsolete. (bought our ipads a few months before the ipad 2 was released.) I can do project management functions, engineering functions, web-surfing, and gaming on my iPad with the various apps. Only thing that would be better for any iPad would be a dedicated usb slot and flash support.