Goodness me, DiapDealer I hope you're not accusing me of shoddy workmanship there!
All our eBooks are validated properly and checked against all Kindle types before being passed to our clients.
90% of the books that are commissioned are straight text, and naturally will easily be supported on all formats without any degredation whatsoever - and yes, Fancy dropcaps and the like ALWAYS degrade gracefully on all devices.
However, some books DO contain fancy formatting, some books aren't run of the mill and contain diagrams, tables etc. There's usually a way to make such things work on the older devices but it wouldn't be commercially viable to hobble the book that will be enjoyed by an overwhealmingly large proportion of the readership.
We as content creators need to be respectful of the existing device owners as they were the early adopters that helped to build the success of the industry - but it is also our duty to responsibly push forwards, to allow our publisher clients to sell books with richer content (not all books are story books, remember) to try to make their titles stand out amongst fierce competition.
Amazon seem to be bravely trying to throw off the shackles of their old, limited format and I applaud them for doing so.