This short article from the L.A. Times highlights some of my favorite bookshops in London. I also make it a point to stop at Any Amount of Books, even if I just pick up a paperback for the plane ride home.
I do love Hatchards, but I usually like to pop into the Waterstones nearby as well, if only to take in the view from their cafe. It's on the fifth floor, so you get a nice view over the Thames.
The London Review Bookshop was on my list as well, and oddly enough, also for the cafe and not the books! I'm glad the author of this article agrees--it makes me feel less shallow:)