There seems to be a bit of confusion about KFX format. Here is an overview.
KFX (Kindle Format 10) is the successor to KF8 (Kindle format 8) for the delivery of content to newer Kindle apps and devices. KF8 and the even older MOBI7 are based on HTML. KFX is instead based on
Amazon Ion, a proprietary data representation created by Amazon.
KFX format is produced by Amazon based on the source format provided by the publisher. Some books cannot be converted to KFX. Those that contain content that cannot be yet represented in KFX format will be delivered to customers in KF8 or MOBI7 format instead as a fallback.
KFX is capable of handling several different types of content: reflowable layout e-books (features similar to EPUB), illustrated layout with video (Kindle in Motion), fixed layout (comics and manga), print replica (similar to PDF), magazines, and dictionaries. Books available in reflowable KFX format are indicated by "Enhanced Typesetting: Enabled" on the product page. For other types of content there is no obvious indicator of KFX format.
KPF (Kindle Package Format) is produced by the Kindle Create application. KPF carries the same content as KFX, packaged differently. Based on the type of book the publisher selects to be created, Kindle Create will produce either the reflowable, fixed layout or print replica variant of KPF/KFX. When possible, a fallback MOBI7 format is produced by Amazon from the KPF for delivery to older Kindle devices that are not capable of handling KFX.
Unlike KF8, which has had essentially the same capabilities as when it was first released, Amazon is continuously extending the feature set of KFX to handle more cases. Amazon periodically re-processes already published books to try to convert them to the latest version of KFX format.