I truly have no idea why I see things differently between screen and page (or in this case, opaque screen), but I do. I don't think I could ever effectively edit myself solely on the screen. I printed Tempest out for editing - a good-sized stack of pages my printer pouted about for days after.
So, when I'm editing on the kindle, I use the arrow buttons to move the cursor in front of the word I want to leave a note by (or the end of a sentence, whatever). Then I just start "typing" (the kindle buttons are too small for that - it's more like hunt and peck with my nails, but I'm already pretty quick with it) a note to myself as if I were making a note on the hard copy. When I'm done, I hit save, and a little number appears in the ms where my note is, just like a proper footnote. You can also highlight and share these notes and such on twitter/fb...which I haven't done yet, but may experiment with eventually. Could be amusing for readers to see some of my "what was I thinking *here* notes".
You can transfer the notes to your computer, but because I normally just go through the hard copy page by page as I'm adding my changes to the laptop copy, I'll probably just do the same with the kindle - move through each note on the kindle as I type in the changes to the revision document. We'll see what my editor/proofreader says, but I think this will be just as effective as using a hard copy, simply because of the difference in appearance.
Another exciting thing Kindle has is text-to-speech...it will *read* to me! I'm a big fan of reading certain passages out loud to make sure the flow reads smoothly as I'm editing. Now I don't have to read to myself, I can turn on TTS, and listen to how it sounds. Very cool.
This morning at work, I took my Kindle up to the break room for my 15 minute break, and edited several pages during that time, no pen or paper needed. I could never really effectively work on revisions at work before, because by the time it took me to get out my pages, pen, settle in at a table, etc...it was time to pack everything back up. Not to mention the potential to draw attention to what I was doing...something I try to avoid at work. With the kindle, I slide the power button, open the draft and go...and it just looks like I'm reading.
Needless to say, I'm utterly hooked. This is going to save me paper & ink, and allow me to do quick editing whenever I have a break or am waiting on someone/something. Fabulous for productivity.