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I'm not really seeing an issue here, other than a minor customer service snafu.
Amazon is perfectly within its rights and ethical obligations to pull a book without explanation. Nor are they required to apply a standard based on the most crude interpretation possible. I'd hope it is fairly clear that there is a difference between the Old Testament and erotica that involves incest. (Making such comparisons is flat-out disingenuous.)
It also seems fairly clear that Amazon is not supervising content at the time of self-publication; instead they are responding to customer complaints. A pre-publication review would increase costs and slow down the process, and automated systems will likely produce "false positives" and not catch a lot of potentially offensive material. Plus I don't see much of a distinction between blocking content before or after it's released. You'd just have a story about Amazon refusing to sell the book in the first place.
Or: Let's say I start up a Jewish bookstore. Is it "immoral" or "censorious" of me to intentionally choose not to sell copies of the New Testament or St. Augustine's Confessions? If my customers complain about a certain book on the shelves for having too much Christian content, is it wrong to pull the book? Should I willfully offend my customers?
Meanwhile, taking a cue from past outrages over deleting books off of devices altogether -- a situation that would automatically require the issuance of a refund, as all access to the book is theoretically blocked -- Amazon has basically pulled the content from their servers. In this case the purchasers still have their own copies, they've just lost the ability to re-download it. If the customer still chooses to own it, their request for a refund should be honored. But automatically issued? That's a bit murkier.
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