A quick check with a hex editor revealed that the Kindle .AZW format contains the magic number “BOOKMOBI,” which led me to this set if free eBooks in Mobi format. Sure enough, when copied to an SD card, MOBI files come right up in the Kindle Homepage.
Here is a free-as-in-beer toolchain for creating MOBI files: http://www.mobipocket.com/en/DownloadSoft/ProductDetailsCreator.asp
So the idea that the Kindle is a proprietary format, while technically true, is overstating the case. Any publisher can trivially create a Kindle-compatible eBook, at least if they already target at least one other digital format.
This gives me significantly greater hope for the future of the device.