Too Smart Guys created the video above (the tutorial portion starting at 2:05), demonstrating how to remove DRM from Kindle ebooks that you legally purchased. To get started, you need the following:
Note: the Python scripts are currently down but Too Smart Guys have been kind enough to provide a torrent you can use to download the files instead.
Once you've got all of that installed and ready, open up the unswindle.py script. You may be required to browse to python.exe in order to run it, but either way the goal is to run it with Python. After an extended moment, the Kindle for PC application will launch. You'll find your Kindle books in Archived Items. Open one up and then quit the Kindle for PC app. At this point you should be prompted to save the DRM-free ebook. Pick a location, and you're all set.
Remove Kindle Book DRM | Too Smart Guys