Now I can't speak to the truth of these claims. I have no inside knowledge but I will say this: be skeptical of such stories. I have seen other stories like this on HN where I have had some inside knowledge and I can tell you that there have definitely been cases that vary between being one side of the story to being a distortion of facts and events to being outright lies.
It's a common theme to have a post of "[BigCo] shut down my account for no reason". I describe such stories as "unverifiable stories in which the poster is a victim".
Like I said, this could all be exactly as the poster claims but it might not be as well. It could be as simple as the person having the same name as someone who got blocked in the US. Who knows? Amazon needs to be extremely careful to be right in situations like this or they risk undermining the ecosystem they've spent so long to create.
I don't mind buying Kindle novels because I tend to only ever read them once. And if they were $6 (like the paperbacks often are) I'd view them as a throwaway purchase.
But when it comes to technical books--books I'll often refer back to and that can cost much more--I'll have to make sure I either only buy the PDF version or I buy the PDF+mobi+epub upgrade from the publisher after buying the Kindle book (2 thumbs up to publishers who do this BTW).