[jhowell]

Originally Posted by Dave_the_rave

What is strange is that when I convert the same book ePub to .MOBI I get the book thumbnail and position/annotations sync working across devices.

Yes, Kindles are able to extract a cover thumbnail from MOBI format, but not from KF8 (AZW3) format.

Originally Posted by Dave_the_rave

So even if I change the file extension of .AZW3 to .MOBI/.AZW/.JPG/.PNG/ and use Send to Kindle for Mac/PC. I will still not be able to get book thumbnails, syncing of position/annotations working is that right?

Any method you use that results in Amazon delivering AZW3 format to the Kindle will not give you cover thumbnails.

In my testing syncing works most reliably using old MOBI format created using calibre or using a Master MOBI produced using Amazon's tools instead of calibre.

If you send Amazon an EPUB with an incorrect image file extension they convert it to Master MOBI. Master MOBI contains AZW3 as a component of it and only that part is delivered to all but the very oldest Kindles.

Originally Posted by Dave_the_rave

Also I would like to know if I want to sync with Calibre is there any other way to sync the books position/annotations with the AZW3 format?

There is a calibre plugin that can extract annotations in a limited way from Kindles. But there is no syncing of positions or annotations between Kindles and calibre.