Proving once again that it is better at bridge-building than Sarah Palin, Barnes & Noble has released a significant update for the Nook Color, pushing the e-reader further down the road to becoming a tablet.

Without elevating the price for the device, B&N has added the Android 2.2 Froyo operating system, which comes with video capabilities, a Nook Color app store offering free and paid apps, a preloaded email client, and some child-friendly features, including a version of Dr. Seuss’ Cat in the Hat complete with learning games and drawing activities.

Despite the seemingly drastic jump into the tablet pond, some analysts claim B&N’s move is more impactful on the e-reader market than it is for other tablet makers. “I don’t think they’re responding to the iPad as much as they’re trying to beat Amazon to the same punch,” Forrester Research analyst James McQuivey said. ZDNet blogger Rachel King noted that the Nook Color’s kid-friendly features make it especially competitive in this market, given that there aren’t many readers or tablets designed specifically with children in mind.

Additionally, the e-reader’s use of Adobe Flash Player support has enabled it to provide interactive features such as videos in more than 150 digital magazines and newspapers as well as more than 225 titles available on the Nook Color. Children’s books and cookbooks are the most frequent users of this technology at this point, according to King. The ability to see books, newspapers and magazines literally jump off the page is new even to tablet makers, which have yet to complete the bridge between e-reader capabilities and video features.

In the tablet market, the Nook Color has an additional edge over BlackBerry’s PlayBook, which lacks a preloaded email app. However, it’ll take a bit of time before the Nook Color app store competes on the level of Apple’s app store and in turn the iPad itself, since the Nook Color store has less than 200 apps. Though, thanks to a free developer program with 70 percent revenue sharing and this host of new features, the Nook Color certainly isn’t on a bridge to nowhere in competing in both the tablet and e-reader markets.