On my Kindle 2, you can edit the default left/right margins. You don't even need to install any packages or jailbreak! I don't know if this will work for Kindle 3 or not, as I don't have one. But for earlier versions, hook the Kindle up to your computer and open the following file with your favorite text editor (e.g. notepad):
You will see a line like the following:
The default is 40 pixels. Change it as you desire; 0 does work if that is what you want. Once you have changed it, save the file, eject your Kindle, and restart it using the menu (Menu > Settings, Menu > Restart). Your margins should now have changed.