They are different beasts. The iPad does much more but cost 3 times the price. If all they will use it for is reading novels then I would say kindle, but if they might want to something a bit clever then an iPad.
If the person you are giving it to is likely to need an Internet connection on a regular basis outside of their home, then 3G is the way to go. But be aware that the 3G versions cost $130 more (in the US) than their equivalent WiFi-only counterpart plus the user will have to pay a monthly service fee for the 3G service - about $15 a month.