A given public-domain text may be represented on the kindle store many times over, submitted by different parties, with different formatting, at different prices.
As a kindle owner, I don't so much mind that there are Gutenberg-sourced public domain texts on there for sale: Maybe a $.99 one is formatted better than the others.
What I mind is that the kindle store is spammed full of such stuff.
The example that bugs me most is the person who took the ten years of Samuel Pepys' diaries, split them up into 120 ebooks each containing one month's worth of diary entries, and put them on the store.
I don't recall if they were charging for them or not, but I was browsing the "history" section of the store, and hit a seemingly never-ending span of one-month Pepys Diaries. Many screens full. On a slow kindle display.
The consumer, who could roam the web and find free Mobi versions from Feedbooks.com or Gutenberg.org, decides to pay a few bucks for the app store convenience. That's their choice.
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Edit: By the way, as the very existence of this license demonstrates, the digitization carried out by PG of public-domain works does not result in public-domain texts.
'A Project Gutenberg ebook is made out of two parts: the public domain book and the non public domain Project Gutenberg trademark and license. If you strip the Project Gutenberg license and all references to Project Gutenberg from the ebook, you are left with a public domain ebook. You can do anything you want with that. '
That way someone can decide if they wish to pay the price for the value add that amazon is providing (presumably convenience) or just go with the free copy.
Without this kind of attribution, many would believe they are either paying for amazons work to format the book or even the book itself (not sure they acknowledge when a work is out of copyright?)
I have done the process of downloading and copying to the Kindle for some works that were either not available in the store. Although it's not difficult, it's not as easy as the Kindle store. This is another case of sometimes easy beats free.
One of the greatest things about the Internet, for me at least, is the easy availability of books. While Amazon is an obvious source, I prefer abebooks.com, as you can usually get a used book there for a fraction of the Amazon price.
Thus one can acquire more books; and if there is any money left over, one might purchase some food.