As for why, it's easy. Taxes. Much like Walmart rents its stores form an LLC it owns to write off the taxes and bring down the liability of the largest revenue sector, Amazon can write off their server costs since they can "rent" them from AWS LLC. While AWS makes a good chunk of change, it has nothing on amazon.com so by making AWS its own entity (and event better for them that its publicly available) they get a gigantic tax write off and AWS makes capex expenditures saving them taxes. All In all, the shell game must save amazon millions just like it does for Walmart
