The device isn’t locked, and you can continue to read anything on it. You just can’t put new things on it directly from Amazon via its built-in interface.
An original-model Kindle has more of its original functionality than an original-model iPad.
Yes, the OS is locked. I misunderstood the point of your statement.
But all you are losing is the ability to use the Amazon store and borrowing that requires DRM. It still works fine as an e-Ink reader.
Anecdotally, the OSes on the really old ones are easily jailbroken. They have never updated them to an unbreakable one that I am aware of.
More than I can say for my first-gen iPads, which would still be wonderful devices for reading books today. I have a Kindle because it is, and long has been, the cheapest e-Ink device. It’s my reading-outdoors device; I don’t use it except at the beach/pool.
An original-model Kindle has more of its original functionality than an original-model iPad.