According to the User's Guide for K2, it is using RealSpeak Solo for text-to-speech. According to the RealSpeak web page, for Windows, it requires a certain level of sound card. For WinCE, it requires a specific processor, but not all features work. The Kindle runs Linux, so it is unclear what the requirement is for that.
I'm guessing that it is not 100% software. It sounds horrible, anyway. If I were that visually impaired, I don't see why you'd want to pay for an expensive e-ink screen

A mini-laptop would probably be better. If you are that visually impaired, how could you see the Kindle menu screens to select books, etc.? At least, on Windows, it reads the whole screen to you, including menus, so that you can figure out what to select.