Works with your current website. You don't need to add units. Existing items will be available in kindle format. As you add more, they get added with kindle. All the publishers rules apply to kindle as well as everything else. All the existing rules stay the same.
I am amused to note that comments are closed; I have no idea if that's standard on that blog, but I suspect it is.
ETA: Wrong! Comments are often open on that blog (and conspicuously empty).
ETAYA: And I think I know why they closed comments. OverDrive must be inundated with this kind of questioning:
http://librarianbyday.net/2011/04/20/some-questions-for-overdrive-and-amazon-about-the-kindle-lending-library/
Wow. Guess _that_ will teach some people not to give content away for free.