Lulu is apparently not going to be affected by Amazon's POD demands because they have signed the contract and given in to Amazon's demands. This means that if I did publish with Lulu which is still the plan) I would be okay.
Lulu has not issued an official statement on the Amazon POD demands. According to Writer's Weekly, Print on Demand publishers are being told to use Amazon's own BookSurge POD printer or else Amazon will disable the "buy" button for their books. Several POD publishers have had their buy buttons disabled. Amazon/BookSurge wants to eventually "have no books from other POD publishers available on Amazon.com."