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I really don't find much insight in this article, it seems uninformed, like someone writing a book review after reading only the book jacket (I used to do that in grade school but don't tell anyone!).
The success of DX is not contingent on whether the device catches on for newspaper reading or education market. As long as they don't lose any money on the ones they sell, they win, because they will sell something from the Kindle Store at huge margins and discourage purchases from competing ebook retailers, since they are incompatible with DX. The release of DX is about keeping a flow of PR going and creating the perception that Amazon is the only game in town. And yes, driving sales of K2, which in turn keeps them buying ebooks from Amazon instead of somebody else (marketing strategy sometimes is about offering choices that few people actually select - google "goldilocks pricing' for instance).
All of the newspapers or magazines signed on to do Kindle subscriptions are also pursuing other electronic subscription opportunities (NYT does not offer all of their content online for free as the author seems to suggest). They'll take subscriptions where ever they can find them as long as production cost is low. And unless I'm missing something Amazon does not stand to make any money on sales of digital textbooks if they are PDF format. It is publicity in search of a market.
As for PDF being the key to DX's salvation because of piracy? Huh? Every student with a Kindle is also going to have a laptop, and laptops are arguably a much better PDF viewing device: you can annotate to your heart's content, using a real keyboard and mouse. If you were consuming or producing pirated PDF's, the Kindle is the last device you'd target.
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