I used Kindle Textbook Creator to publish my book on Kindle. PDF is not a mobile friendly format and I have had complaints. How do I submit the second edition so text can be resized by the reader and automatically formatted for different devices? Does it have to be saved as an HTML file?
You can't. Once you've created a fixed format e-book you're stuck with it. You can't replace a fixed format edition with a reflowable edition. If you want to publish a reflowable e-book, unpublish what you've done, reformat your file and upload as a totally new book. It will have a new AISN. As you've discovered, fixed format books have severe limitations and are not viewable on all devices, which is why it's a step taken when there is no other choice.
If you wrote your book in Word, you can go back to that file and upload that, as long as you used Styles properly. Word can create a nice reflowable book if it's just straight text. NotJohn has a link in his posts to his blog, where he has tips on using Word and Styles.