I have installed a few modifications and don't want Amazon breaking it with OTA updates.
This is how I disabled the 'Settings -> Menu -> Update Your Kindle' and hopefully automatic updates too.
: Kindle Touch 5.0.3, jailbreak, root ssh
What it does
: If you start update from settings, it logs a message about disabled OTA, the update*.bin file stays untouched. If you restart the Kindle, the update fails (error 3, press home to continue) and the update*.bin is deleted.
1) edit file /etc/upstart/ota-update.conf
2) create file /mnt/us/DISABLE_OTA
(/mnt/us is what you see if you connect Kindle as USB mass storage)
To re-enable updates
: remove or rename the file /mnt/us/DISABLE_OTA . (Or delete the modification from /etc/upstart/ota-update.conf)
As always, make backups and be carefull. No guarantees.