As of 2012 Amazon sells more Kindle books than physical books in the UK. I suspect that hasn't changed since then. So I'd argue defaulting to kindle is the right product decision as it's the option the majority of users want.
Amazon Prime on the other hand is definitely a dark pattern.
Amazon has 15 years of shopping history from me that includes multiple physical books each month and 0 kindle purchases. Its possible they don't consider that and default to kindle for everyone, but they at least have the info to know that kindle versions are not what I'm after.
Amazon is incredibly good at converting consumer surveillance data in to money. They could easily default this (and many other things) to sensible per-user values. Given their competence and attention to detail, the reasonable guess here is that playing dumb on this default pays better than doing right by the user.
Maybe what's happening is: if you have a Kindle (you bough it form Amazon - or you bought kindle books on your account), they assume is likely you want a kindle version. If you don't have a Kindle, they want to show you how cheaper the Kindle version is, and maybe you will end up buying a Kindle.
They sell more e-books because the publishing industry colluded to jack up the price of paperbacks so that $10 e-books look like a bargain. I'm not paying $15 for a physical book that would have been $5 15 years ago. Their production overhead has been dramatically lowered by digital distribution and I'm expected to pay more?
I think it's the convenience for both buyers and sellers. If readers want the book "now" they get the kindle version; if they want it later they get the physical copy. However, Kindle in general is a dark pattern: it forces users to be locked into their product ecosystem.
Amazon Prime on the other hand is definitely a dark pattern.