No, you can’t change the kerning (space between letters) or font (not easily without involving a hack). But you can alter the line height, the distance between the lines. Adding more space may make it easier for some to read, and adding less allows more content per page.
The command SHIFT + ALT + NUMBER changes the line spacing from less on the 1 side to more as the number increases. The default is 3. While 1 is too small, 2 seems quite good to me. You need to hold down both the SHIFT and ALT keys at the same time (a little difficult for my paws) and then press a number key.
In readability, the ability to change line spacing can matter. A few years back, I spent some time as a technical writer and produced camera-ready copy for publishing. So I can appreciate the importance of this.
Illustration above shows the Kindle 2 Keyboard Selecting Line Height 2. And ahead are screenshots of the Kindle set at Line Heights of 2, 3 and 5. For yet other reading tips, see Kindle 2 Screen Contrast – Light Text, Dark Background & Solutions, from iReader Review.