For the most part I agree completely. Given the choice most users will the multi-use android/ios tablet over the specialized e-reader. I have both and generally prefer the android to eInk because its a more flexible device and I just don't read enough outside road trips to justify anything but the tablet.
But personally I believe that barring some technical innovation e-Ink will continue to dominate as a dedicated device for voracious readers and heavy travelers. Most people just can read for multiple hours on LCD screens without eye strain and the headaches they cause. That and combined with the amazing battery life and significantly reduced weight will keep dedicated readers around.