Sure, but what happens when Google's Android market place remains dominant, they release new versions of Android for Tablet and SmartPhone that become incompatible with Amazon's version of Amadroid? It doesn't have to be forever - if new games, new high-demand software is released for Android phones and Tabelts, even if it takes 6 months for Amazon to make their OS compatible and 6 more for app developers to put out their apps on Amazon App Store - they lose. Amazon doesn't make phones - Google and its partners do and that's where most of the Android app ecosystem is focused.

I honestly don't think Amazon will take that risk - their changes are going to be cleanly designed such that they can pull Google's AOSP code, merge their changes and crank out their own updates. I can't see Amazon developing 2.1 code base without merging Google's bits from newer releases - there is just no way they are going to be able to catch up with all the stuff Google and co. are putting in Android - they will never have that kind of expertise unless they hire people from Google/Android team which I find somewhat far fetched.

Keeping up with the releases from 2.1 and going to 4.0 is going to be a huge pain. And that will be required for compatibility sooner or later.