What I know about publishing e-books through Amazon's KDP platform (updated August 2015):
Amazon maintains the Kindle Publishing forum that I visit often, and where I and others will answer formatting questions. And there's an especially good Kindle Formats forum on MobileRead dot com. And of course Ask the Community on the Kindle support pages, though it's heavy on disgruntled people and bad advice.
I prefer to work in html and upload an epub (see below) because it gives me complete control over the book. There's a learning curve, but the same is true of any method of submitting books to the KDP. However, the Amazon software does a fair job of converting *.doc files, if you are religious about using Styles. (The more recent your version of Word, the better it works. Word 2000 is terrible; Word 2013 isn't bad.) If you're determined to go this route, here are some free resources:
Shauna Kelly on using Word (Basic Concepts, Styles, and Tips for Using Styles)
Tech Republic advanced formatting tips
Amazon's simplified guidebook
Mark Coker's Smashwords guide
JT Bigtoad's rules for formatting Word
Tips for Formatting Your Book Correctly in Microsoft Word
And for transitioning from Word to html:
Joshua Tallent: Html Basics for Kindle
Guido Henkel: Take Pride in Your Formatting
And whatever you do, PREVIEW that book after it has converted (Step 7 in the publishing process). The downloadable Kindle Previewer gives the best results. Download it and your converted mobi file, and check it in all the available emulations.
I have settled on a single book file, style sheet, and format across all retailers. That requires me to build an epub. This is more challenging than Word, html, or mobi format, because epubs must be validated in order to get on the iBookstore. This is my system (subject to change, as always):
1) For a variety of reason, I generally wind up with my book in the form of a Word document. To turn it into a workable html file, I run the it through word2cleanhtml.com on the web, a free service. (This also works for an Open Office file: just save it as in Microsoft Word 1997/2000/XP format.)
2) I then paste the html file into a template I have previously created. It contains the basic framework of a web page and a link to my standard style sheet. Clean up the word2cleanhtml file as needed (it's not 100 percent accurate) and validate the result at http://validator.w3.org/ -- vital for building an epub, and a good idea for uploading to the KDP. Though the KDP conversion is fairly forgiving, as applied to the e-ink Kindles, good html has become more necesssary with the advent of the Fire and especially for the Look Inside preview.
3) I open the html in Sigil (a free download) and break it into chapters (epub devices prefer mutiple files to one large file). I use the Semantics and Metadata tools to build the OPF and NCX files, and I validate the result at http://validator.idpf.org/ -- vital for the iBookstore.
The resulting epub will work on the KDP, on Barnes & Noble, on Kobo, and (through Lulu) will pass muster at the iBookstore.
If all else fails
If you're ready to move on from Word, but html and Sigil terrify you, there are three purpose-built word processors that will help you advance: Jutoh, Scrivener, and Atlantis Word Processor. Each costs about $40 and has a trial version, each will give you some control over formatting, and each will create an epub you can upload to the KDP or any other e-tailer. From my limited experience with these softwares, I would be inclined to favor Jutoh.