My kids use educational apps for sure. We have a host of math apps from McGraw-Hill as well as a nice US Presidents App and Periodic Table of Elements App. They also love BrainPop that they get extended access from school. That has educational videos on it. There is nothing like listening to your 5 year old learn about the Trail of Tears.
We briefly had a Nook (the most advanced one) that we looked at for DD for her 7th birthday. I returned it as it was incredibly inflexible and non-intuitive. It also did not coordinate with our library's lending system. I would not recommend it.
They are. Even better is that a few times a year the McGraw Hill ones are free. I have built our collection when they go on sale.
I also like games that make the kids think...
Scribblenauts has helped my DD a) figure out spelling, b) use a dictionary, and c) think outside the box.
We also have Slice It. It is good for learning fractions without "doing" fractions.
And Hang-Man is the last game my DD plays. It is good for spelling. Even better when DS who has not yet started K gets into the game.