The .azw2 is the complete packaged artifact that is meant to be deployed on a Kindle.
The emulator above works at the source code (well, "compiled source code" level).
You're running it in the completely wrong way. Java takes a class as the first argument to run, not a .jar file. And the "emulator app" takes another class as an argument, not an .azw2 file.
The following might work (on Windows):
java -cp "vavi-kdkemu.jar;test.azw2" vavi.apps.kindlet.KindletViewer test.Main
On Linux, use java -cp "vavi-kdkemu.jar:test.azw2" ...
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