From Open Access News:

Monday, September 21, 2009
Amazon Kindle Store vs. public domain books

Keith Dawson, Amazon Delaying Public Domain Submissions On Kindle,
Slashdot, September 18, 2009.

John B. Hare writes

Many publishers of public domain content on the Kindle are being turned away for reasons that Amazon declines to clarify. In the past two weeks any publisher posting a public domain book (or a book that appears to be a such) has received the message 'Your book is currently under review by the Kindle Operations team as we are trying to improve the Kindle customer experience. Please check back in 5 business days to see if your book was published to the store.' Amazon claims that this is a quality control issue ...
I own and run one of the primary contributors of new public domain e-texts on the web: sacred-texts.com. I am (was?) in the process of converting all of the 2,000+ e-books at sacred-texts into Kindle editions. ...
I just received the following email from Amazon:

Dear Publisher,
We're working on a policy and procedure change to fix a customer experience problem caused by multiple copies of public domain titles being uploaded by a multitude of publishers. For an example of this problem, do a search on "Pride and Prejudice" in the Kindle Store. The current situation is very confusing for customers as it makes it difficult to decide which "Pride and Prejudice" to choose. As a result, at this time we are not accepting additional public domain titles through [Digital Text Platform], including the following: [Note: omitting list.] ...

One key point is that Amazon has applied this ban completely non-selectively. Established publishers such as myself and others who have never had any quality control issues whatsoever, and give good value for the price, have all been tarred with the broad brush of "Public Domain Publisher — do not post." ...