Pocket PC definitely (although what did you expect on a PPC website! :wink: )
Seriously though, reading e-books is the main thing I use my Pocket Pc for. It is wonderful. I love having my books with me all the time. I can grab a few minutes reading whenever, and it is instant startup when I turn it on again.
I thought that it might be difficult reading for a long time on the screen, but I have had no problems. I also love being able to read late at night in bed with the lights off so as not to disturb the spouse.
As for readers, I agree that pdf isn't the best, I like Mobipocket the best, and I especially like the landscape mode for reading. You can switch it to landscape and full screen mode, and the text takes up pretty much all available space. Add in the ability to change font sizes easily (I often start increasing the font size at 2 a.m. when I am getting tired

) and it is a great tool for reading.
Microsoft Reader is pretty good too, and I am currently reading a book in that format, although I like Mobipocket better. Have read in PDF, (just finished Bill Bryson's A short history of nearly everything, and it wasn't too bad).
Basically I would recommend the pocket pc over a laptop anyday. Quick access (no long bootup) portability (my IPAQ 1940 is in my pocket all the time) weight (it gets old holding a laptop for a long time, not to mention the heat if you have it in your lap, and the noise of the fans and drive etc).
There is no contest for reading.