Return new Kindle Fire?

Hi,

I just sold my original iPad a couple weeks ago and got a new Kindle Fire (on sale for $169!). I like it a lot because it is smaller and simple to use and does everything I want it to, which is mostly content consumption. I live in the US, and recently subscribed to Amazon Prime, although I have not used the instant video feature yet.

However, I am now seriously considering utilizing the 30 day return policy to pick up a new Nexus 7. Do you all think it is worth it? Clearly, it has better specs and is most likely faster and smoother, but I have never used an Android device before (I had an iPhone and iPad, and use a Windows PC and a WP7 now), and the number one thing I'm worried about is the apps. My Kindle Fire has a decent number of apps, and I know Google Play has a ton, but after looking through the app store, I am kind of confused as to how, or if, it distinguishes between tablet and phone apps, how well they scale, and what devices they run on. The other thing I want to know is how much is can replace a Kindle. I just started using Amazon cloud mp3, which I saw an app for, and a Kindle reader app. Can I still rent and loan books through Amazon Prime on this device, or is that Kindles only? And will the Prime Instant video work on the Nexus 7?

Anyone who wants to help me out, let me know what you think. Feel free to add in why you like Android (if you do), as I have never used it and don't know too much about how it works.

Thanks!