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Technically, you can't do this. I'd like to hear of people who've tried it and know what the results are, but the Amazon pricing page states:
"For any Digital Book for which you select the 35% Royalty Option, at all times that the Digital Book is available for sale through the Program, you must adjust the List Price as required to ensure that the List Price, plus 15% (the statutory Luxembourg VAT rate) for sales to UK customers, does not exceed the lowest of: (a) the lowest suggested retail price or equivalent price for any digital or physical edition of the Digital Book; (b) the lowest price at which you list or offer any digital or physical edition of the Digital Book on any website or other sales channel; and (c) any maximum List Price we provide from time to time in the Program Policies."
Which basically means you can't have it free elsewhere and at Amazon for $0.99. That is, considering I'm reading the jargon correctly.
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