But all is not sunshine and roses...
1 - Alloy may use anything you publish and not compensate you.
2 - Amazon will have rights to your works for the entire term of copyright
3 - Pornography will not be permitted. (Whether that means that non-canon LGBTQ stories without a sexual component are prohibited has not be determined.)
John Scalzi has a terrific overview of the new program on his blog, Whatever: Amazon’s Kindle Worlds: Instant Thoughts. The comments are as interesting (and in some cases, rage-provoking) as the article itself.
I find the timing of this particularly interesting in light of this article: An Unforbidden Love: In fan fiction, your favorite characters can do … whatever you want them to, which explores the new popularity of fan fiction in the mainstream. Including slash fic. The graphic at the top of the article is worth looking at, particularly for K/S 'shippers.