It will work outside US, no matter you root/flash it or not, you can still browse web, read docs/books/comics, watch your own videos...
But you may not use the Amazon version of "Market" to get apps.
And for sure you can flash it, root it and enjoy almost full Android features.
P.S. I am a KF user in Hong Kong(which is apparently outside US), now using IceCreamSandwich on the KF and previously using CM7.
Motorola ATRIX ME860(CM10.1 by epinter) , Motorola RAZR M XT907(4.1.2), Amazon Kindle Fire(CM9), Google Nexus 7(4.2.2)