Amazon's Kindle App for iPhone and iPod touch is now live in the App Store. It allows access to hundreds of thousands of Amazon Kindle format e-books (we assume the whole 200K plus library).
The Amazon Kindle for iPhone app is FREE (iTunes Link), but it looks like books need to be purchased from Amazon directly via PC or Mac and transferred over, or from the iPhone via Mobile Safari. Most e-books should run $9.99. Like with the Kindle device itself, you can sample first chapters for free, adjust text size and bookmark. You can't annotate but you can view Kindle annotations.
Whispersync is also enabled so you can start reading on the Kindle, switch to the iPhone, and basically go back and forth without losing your place. Books you've already purchased for the Kindle, of course, can be placed on the iPhone or iPod touch as well.
Note: Per Dieter, this doesn't seem to be showing up on the iPhone App Store app yet, and -- of course -- it's not available (yet?) in the Canadian App Store (or any international App Store?)
Any Kindle users out there ready to test this out and let us know how it's working?