Kindle books are not $9.99 the way iTunes tracks are $0.99. There are many many Kindle books that cost less than that (or more than that). They're just saying that they'll try to make everything on the bestseller list cost no more than that when they can get away with it, which isn't too bad a price (once you get past the idea that ebooks ever cost more than like $1).
As far as it being yet another proprietary format, that appears to be wrong. As far as I can tell the format *is* Mobipocket completely, just with the DRM setup so that *currently* you can only decrypt the books on a Kindle. If the format is successful then there's no *technical* reason why they couldn't be enabled for reading with Mobipocket reader, etc.
Z.
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