It depends on how you read. I am often reading several books at any one time (obviously not simultaneously) so having the ability to read one book for a while and then effortlessly switch to another at any time/location is a big plus for me. Having had the kindle dx for a while now, I find it pretty much equivalent to reading a paper book and I don't miss the paper versions at all.
A paperback is lightweight, cheap, durable and independent of other resources. Most importantly, a book as an experience is a long, drawn out affair. Books take hours to enjoy, so it's of little importance how many I can carry at a time.
Music/movies have the opposite effect ~ they are shorter durations of entertainment, so the more I can carry, the more I can enjoy the experience. The major advantage of digital music is that I can carry my whole library with me in my pocket. Even if I could do this with my bookcase, there is little reason for me to do so. This defeats one of the major advantages of kindle.
I don't disagree with anything you say, but I don't think the death of the book will happen any time in our lifetime, or our children's lifetime to be honest.