Oh, what do you know? The full license terms add even more confusion. Here are the relevant bits:
In the You-May-Not section, "1. Resell a resource directly or within a wider design/product where the original resource can be extracted in its’ original form. Please see the general and resource specific FAQs for further details. 2. Resell a website template whereby the embedded fonts, graphics or other resources can be extracted. For example – web fonts, or background textures could be extracted by a new customer, without them owning this original licence – this is not acceptable. This is acceptable when the template files are passed on to an individual client, although a licence will be required for both yourself, and your client, to justify this."
In the same section, "4. Use fonts or graphics within ebooks or downloadable publications whereby the fonts or graphics can be extracted in their original form from this document."
None of those direction reference embedding files for printing paperbacks, and it's once again clear that Design Cuts isn't thinking about the same things we are.
There is also a font embedding section. It says, "You may embed characters from the Resources into any document you send to third parties but such documents may be viewed and printed (but not edited) by the recipients. You may not under any circumstances embed characters from the Resources into software or hardware products in which the Resources will be used by the purchasers of such products, or from which the Font Package can be extracted or transmitted. Examples of such products may include but are not limited to electronic books or magazines, mobile applications, gaming consoles or electronic games, embroidering or sewing machines."
Doesn't Word still allow for the embedding of only the characters used in the file? That may be what is alluded to here. Again, it's interesting that embedding in files for printing is not directly addressed. Does KDP Print edit your work? No, it just makes sure that it is print-ready and does the printing. Any editing is handled by you. Do book buyers get a copy from which they can extract fonts? No.
I'm pretty sure if you make the inquiries based on the questions I suggested in my previous post, you will find that Design Cuts is probably OK with what you want to do. In light of the somewhat inconsistent verbiage, it would pay to check, though.