The first is straight through, cover-to-cover, one page at a time, front to back, put it down - the way most novels are read. For that I reckon the iPad and similar devices are absolutely fine.
Second: reading only specific sections at a time, cross-referencing with other texts, using the index to find related subjects. Relevant to manuals, guides, technical documents, textbooks. For something like this, an e-text is almost certainly superior to a printed book - it weighs nothing; it has to be less intimidating than the thousand-page behemoths the students pick up at the beginning of term; you can hyperlink and add your own notes; updates and revisions can be uploaded (one hopes) easily; you can look up unknown terms or references; you can search the entire text almost at once.
Third: browsing, dipping in and out, relying on serendipity to give you what you need at any given time. This is the way I read a book of essays, a poetry collection (particularly an anthology), some reference books (the Oxford Companion to English Literature, the Penguin Dictionary of Literary Terms and Literary Theory, the Encyclopedia of SF, even for that matter an English dictionary) and, at present, Henry Kamen's European Society 1500-1700. Because I'm pretty slow to take in something from a history book I'll often need to flick back and forth to check a name or an event, or to re-establish a context, from several pages before or after; it takes several visits before the details of a passage are memorised. That is the weakness of an e-book - all it gives you at any point is, at most, two pages. A printed book is present in its entirety, and nothing an iPad can do is going to match the speed of simply riffling through the pages; nor can it give you the fruitful resonance, the chord-making which results from juxtaposing one passage with another; nor can it aid memory through the association made with the physical layout of the text on the page.
Writ large, the same holds true of the bookshelf. If you were to take all the books you own, chuck 'em out and replace them on an e-reader, no doubt the sense of liberation would be very welcome, and it'd be a weight off your floorboards, but you simply wouldn't have the pleasure of scanning the shelves at a glance and seeing something you'd forgotten, or taking something down at random.
I am emphatically not against the iPad. I'm in favour of anything which upholds and develops literacy, and by extension, a thinking and informed public. It's just that the technology, while it brings many very useful benefits, does not meet all the needs of the reader. In certain specific ways the printed book cannot be surpassed. Novel-readers and textbook-users will gain from the iPad, but I doubt very much that the same will hold true for browsers like myself.
Of course, prior to the invention of books, browsing couldn't exist; no doubt the iPad will lead to fascinating and rewarding new practices appropriate to the technology, just as the internet has given rise to blogging (itself impossible to define precisely in a paper-print context - not quite a diary, not quite an essay).
I'm glad to have come across this passage from a 2002 article by Malcolm Gladwell which neatly expresses what I've been trying to reach for above:
According to Sellen and Harper, paper has a unique set of "affordances" -- that is, qualities that permit specific kinds of uses. Paper is tangible: we can pick up a document, flip through it, read little bits here and there, and quickly get a sense of it. (In another study on reading habits, Sellen and Harper observed that in the workplace, people almost never read a document sequentially, from beginning to end, the way they would read a novel.)(Hat-tip to blogger Brett at Branches and Rain for this.)
I'm even more heartened by Dr Johnson's comments, the only one of which I knew was the following:
Mr. Elphinston talked of a new book that was much admired, and asked Dr. Johnson if he had read it. Johnson: “I have looked into it.” “What,” said Elphinston, “have you not read it through?” Johnson, offended at being thus pressed, and so obliged to own his cursory mode of reading, answered tartly, “No, Sir, do you read books through?”- and that from a quote on the cover of Schott's Miscellany. It turns out there are quite a few others from Johnson on the benefits of browsing, all of them worth reading, and they are helpfully collected at this post on blog Miscellenies. Ain't e-reading great?