The process of importing feeds is extremely painful, since Google Reader subscribes to each feed one by one. If you only have 5-10 feeds in iGoogle, it will import the feeds quickly, but you'll need to wait a lot longer if you have more than 50 subscriptions.
You can select the feeds that should be imported and Google Reader will convert iGoogle's tabs into folders.

Last year, I wrote a script that exports iGoogle feeds to OPML, so you can import them in other feed readers. It's more difficult to use than Google Reader's feature, but at least it's efficient.