I agree entirely, but it comes down to common economics. The author isn't going to allow his work to be sold for less. Amazon still need their cut, and they are never likely to reduce the cost for eBooks entirely because they still make money from hard and paper backs. I definitely prefer reading my kindle now I have got used to it though and aside from buying my favourite author new releases on hard back, I will buy all other books on Kindle from now on.
I have just purchased a Kindle and have quite a few books that are cheaper than buying paperback. Today however, i found a book that I really want to read - £9.99 for a beautiful hardback and £9.99 for kindle version - I know which i will be buying = the hardback to then pass on to my mother to read after me. She has no kindle. There may be VAT to add, but excuse me for adding the cost of paper/printing/transportation to store etc.