Kindle should be fine for the things you're using it for. I went with the Nexus 7 because I wanted the apps I had bought on the Google play store on my tablet. You can't do that on the Kindle unless you are willing to root your Kindle and tweak it. If you're only playing games like Words With Friends this shouldn't be an issue for you because you can get it free on Amazon's app store.

As far as cloud storage goes I'm a fan when it comes to things like movies, music and pictures. 16gb should be enough if you use the cloud. My tablet is 32gb, but I have several very large apps on it so I wanted the space.