My decision to upgrade to the iPad Mini was pretty much made for me when I lost my iPad 2 in a mugging.
I went with a 64 GB WiFi model, and it's been a more than capable replacement for my old purloined tablet.
I find that I spend approximately two-thirds of my total iPad time inside of Stanza, my favorite e-reader app. Where I would only occasionally be reading a book on my iPad 2 while on the subway, it's now my primary use for the device while commuting. It feels perfectly natural, given the iPad Mini is already roughly book-sized.
With the same resolution in a smaller space, denser pixels make for richer images and video, so I've loved watching Netflix and Hulu+ on it despite the smaller display. It can also pump full-quality video to my HDTV, which makes it a cinch to give up cable. (I quite literally got a phone call from my cable provider after typing that sentence. They must have eyes everywhere.)
I'd have to say that I'm using the Mini more often than I was using my iPad 2. I'm checking email and browsing the web in bed, which I used to be pretty good at avoiding. I'm playing games on the couch as I procrastinate before work in the morning. And, of course, Netflix–at the kitchen table, in Starbucks, in the park while tethered to my iPhone–always Netflix.
The internals are more or less identical to my beloved iPad 2, but the iPad Mini's size seems to have lent it some more utility than my previous tablet had. While I'll remember my iPad 2 fondly, I have a hard time being bummed out about my newer, smaller, and equally-or-better powered iPad Mini.
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