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yes, to use 3G your Kindle must be registered.
Your second question is a little trickier. It is generally agreed that Amazon has the ability to look onto your Kindle as long as WiFi/3G is turned on. There has been much discussion (up there in the developers forum) on what type of info Amazon collects and logs. Regardless, the only time I've ever heard of Amazon banning an account is for over zealous return practices and fraud such as purchasing with stolen credit card numbers ... that type of stuff. I've never heard of an account being banned for dubious material although putting those books on a device is against the Terms of Service and Amazon has the grounds to close your account over it if they wish to do so.
Everything on my Kindles has the DRM removed which is also against the TOS - even the books I purchased from Amazon. Amazon has never contacted me or made a peep over it.
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