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HarryT,
You are 100% correct.
Amazon is just a distributor. They do not set prices. They do not pick who can be borrowed. They do not say rather a book has DRM or not. As a matter of fact, the royalties are not even set in stone except for certain price points for indies and small publishers.
99 cents and 1.99 are always 35%. As is anything over 9.99.
Between those price points the author can choose 70% less a small delivery fee or they can choose 35% with no delivery fee.
The author/publisher chooses it all.
And even if an author chooses Select (Kindle Unlimited), it is only a 90 day commitment then they can decide to renew or stay published with Amazon and be able to publish elsewhere.
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