@NiLuJe
Well, I rechecked Doitsu's test file and there's good news and there's bad news. The good news is that it's rendering perfectly on his K3. The bad news is that his test file is not rendering correctly on my old Kindle Fire (2011). Neither is my test file.
Here's the thing. I installed Aldiko on my Kindle Fire and tested an epub with the font embedded and it rendered perfectly. I took the same epub, ran it through KindleGen (converted without errors) and then tested the mobi and it didn't render correctly. What could be wrong? Obviously, the device is capable of rendering the font correctly otherwise the epub would have been off too... I feel like
BTW, the same mobi renders correctly on my new Kindle Fire HD.