I have a new one that I need some help with because I haven't tried some of these conversions. I'm avoiding the whole "removing DRM thing" because I'm unsure of how much I can say and not run afoul of forum policy.
Partial Truth:
The Kindle is limited in the number of formats it can read.
Whole Truth:
While the Kindle reads a limited number of formats *natively*, nearly all of the currently available popular formats can be converted for use on the Kindle.
Note: This information can apply to most ebook readers though the formats in question and the tools used for conversion may differ.
Native Formats
.azw (the Kindle version of .mobi)
.azw1 (aka Topaz)
.txt
.mobi and .prc (unprotected MobiPocket = no DRM)
.aa and .aax (Audible.com audiobooks)
.mp3 (you know what those are)
May or may not need conversion
.html (simple .html files may be converted but if the extension is changed to .txt, it can be loaded directly onto the Kindle)
.jpeg (will work if placed in a special "screensavers" folder when creating custom screen savers, otherwise jpegs must be converted)
Need conversion by Amazon or other software
.doc (MS Word files)
.pdf (this is still and experimental conversion, if the document is heavy on charts, graphs and tables it won't turn out well but mostly text documents will be fine)
.jpeg
.gif
.png
.bmp
.zip (the zipped file itself is not converted but you can zip a bunch of documents together and send to Amazon for conversion)
Need conversion with other software (not through Amazon) - DRM free versions
.lit (MS Reader format)
.epub (an emerging new standard)
-er.pdb (eReader format, favored format at Fictionwise and eReader.com)
.mobi (some secured mobi files [DRM] can be read with the use of the Kindle's PID)
Cannot be converted (at this time)
.lrx (Sony's secured format)
Adobe Digital Editions
Now that you know what can be converted you need to know what tools to use. Here is a list of FREE software that every Kindle owner should have *if* you want to venture outside of the Kindle store or want to create your own Kindle ready documents. You won't need all of them and some features overlap, but you should experiment to see which ones you like working with best.
MobiPocket Creator and MobiPocket Reader (Windows only)
Calibre (Windows, Mac and Linux)
Stanza (Windows and Mac)
KindlePID and KindleFIX (Windows and Mac)
Mobiperl (Windows and Mac)
Mobi2Mobi Command line (Windows and Mac)
Mobi2Mobi GUI (Windows only)
Learn about other types of ebook conversion software by visting our E-book_conversion wiki.
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Okay, what have I left out? What is incorrect or not quite correct?
Edited:
Added eReader format
Added jpeg to the "needs to be converted" list
Added jpeg screensaver info
Added the qualifier that "simple .html" files can be used if the extension is changed to .txt
Added list of software package
Edit: in italics