I too think this is going to be a great tool for children's education. My 2 year old son, love to play with his "apple" as he calls it, which is really just a iPhone 3G that we have as surplus once we got the 3GS. We have been using it as an iPod for music in the house, when we thought maybe he could use it.
Here's a free tip for you. You can sell an iPhone 3G for $300 + on eBay. That will pay for a very large portion of the cost of an iPad.
Apple deciding what books can be published = VERY VERY BAD
AldenShaw hallucinating again = Priceless
Who says Apple will control what books can be published? Do you think that the iPad will be the only route to market?
Furthermore, iTunes already has a far wider selection of music than Amazon or anyone else out there. Why would Apple be more restrictive of books than they are of music?