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Originally Posted by kindlekitten
Information Received. The Device Software will provide Amazon with data about your Device and its interaction with the Service (such as available memory, up-time, log files and signal strength) and information related to the content on your Device and your use of it (such as automatic bookmarking of the last page read and content deletions from the Device). Annotations, bookmarks, notes, highlights, or similar markings you make in your Device are backed up through the Service. Information we receive is subject to the Amazon.com Privacy Notice.
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Dude, he's actually right, this is the relevant paragraph. Basically it is giving examples of the content of data being sent back to Amazon, but is not limited to those listed. In short Amazon can collect any data from your Kindle that they see fit. Got a law document on there and am making notes in relation to a case?...they can take that.
The bit I especially like in the document is;
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No Reverse Engineering, Decompilation, Disassembly or Circumvention. You may not, and you will not encourage, assist or authorize any other person to, modify, reverse engineer, decompile or disassemble the Device or the Software, whether in whole or in part, create any derivative works from or of the Software, or bypass, modify, defeat or tamper with or circumvent any of the functions or protections of the Device or Software or any mechanisms operatively linked to the Software, including, but not limited to, augmenting or substituting any digital rights management functionality of the Device or Software.
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You breach the terms and conditions of sale if you open it up and replace your own damn battery. Amazon are well within their rights to suspend your service if you do not use Amazon to replace your battery, even for an out of warranty unit.