The new, bigger Kindle DX has a screen resolution of 824x1200 pixels , for a total of 989 Kpx. This is twice the 480 Kpx on the Kindle 2 (resolution 600x800 pixels ). Since DX only costs 36% more than the smaller tablet it's a good deal on a cents-per-Kpx basis: 49 vs. 75 cents. (Though my Dell 30-inch monitor is only 27 cents/Kpx — in color to boot.)
Unfortunately, crispness has been sacrificed in the move to a bigger tablet. The DX only has 150 dpi, compared to Kindle 2's 176 dpi.
Reduced crispness means fuzzier fonts, which again means reduced legibility and slower reading speed. Thus, Kindle DX is not likely to replicate the pleasant reading experience of Kindle 2. This is particularly catastrophic since it's intended for reading textbooks which are dense in word count.
Combining the bigger screen with a PDF capability means that Kindle DX can in fact display textbook pages in their original layout, which will make it better for reading non-fiction, except for the fact that many better books are designed with the page- spread as the unit of layout. For example, my own books sometimes provide a full-sized screenshot on one page and the associated caption on the facing page. (At a minimum, our book designers aim to place illustrations on the page facing the discussion of that picture in the body text.)
Seeing only one page at a time will reduce students' ability to learn, relative to reading books that display two-page spreads as the designer and author intended.
(As an aside, even though I am critical of PDF as a format for browsing Web-based information, such as product specs, it's great for displaying book pages on a tablet like Kindle. I applaud Amazon for embracing PDF in this device.)
Kindle DX retains most of the downsides of Kindle 2, in particular awkward interaction design and slow response times. (And monochrome illustrations, but I can easily imagine them moving to a color display in the next release.)
In summary, Kindle DX is not likely to be a good substitute for reading printed textbooks or newspapers , particularly if newspapers are not redesigned for the device, but simply transmitted as repurposed full-text files.
I don't even think Kindle DX will be as good as the Kindle 2 for reading fiction, because of the reduced crispness and likelihood of reduced reading speed. (We have to await somebody doing a controlled reading speed study, though, before we know for sure.)