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Connect the AC power first, and disconnect it last.
Conversely, connect the small end of the USB data/charging cable to the Kindle last, and disconnect it first, when charged.
Try not to drain the battery below 40%, and if you do, recharge it immediately.
Don't always charge the Kindle to 100%. Shoot for about 80%. Once in a while, charge until just full (100%) without overcharging (it will probably shut off anyway, but it may not).
Once in a while, discharge until Kindle asks you to recharge. Try to hit this discharge point as quickly as possible; pick a day when you are going to do a lot of reading, and let it discharge until it warns you it wants a recharge. It will say so, on screen, in a pop-up dialog box.
When the pop-up appears, charge to 100%, then immediately disconnect (hopefully you notice the charge LED changed colours, within an hour of it having done so -- no big deal if you miss it and let it stay on the charger, but it's not ideal to do so).
No reason not to use Kindle while it's charging, but you may want a table easel type of stand for it, to give best mechanical protection to the USB data/charging port, and the cable.
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