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No, the downloads to PC for USB transfer are never in KFX. They are mostly azw3/KF7. Some might be reflowable .mobi or azw (KF7). Some might be PDF wrapped in Amazon file or other non-reflowable.
On "Download to PC for USB transfer" you have to select a target Kindle device if you have more than one Kindle. Some files can't be downloaded for eink Kindles.
Amazon are not supporting epub on Kindle eink (currently, who knows about new models). They MIGHT support it on Fire and Kindle Apps and Kindle for PC. BUT what they are doing is using the long existing epub upload for KDP for Send to Kindle.
For years the best way to upload for publishing was uploading epub2. Then Amazon converted it to mobi/azw (KF7), azw3 (KF8) or KFX. They then delivered the appropriate format to Kindle. Newer Kindles, Apps and Kindle for PC mostly get KFX by direct internet, wifi or cellular. Download For PC is mostly azw3/KF8 for newer Kindles and mobi/azw/KF7 for ancient Kindles (older than KK3 and all DX models).
You should download all your ebooks anyway!
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