I think most people do recognize the compromise.<p><i>It does nothing well except emulate words on a printed page.</i><p>Thats the whole point!  People want something they can stare at and read for hours without hurting their eyes.  Its target specifically at people who want to get the book reading experience without carrying around a book.<p>As for the limitations you mentioned, I believe they are well acknowledged.  At the moment, people are just happy to keep their eyes in good condition.