Has anyone heard of any changes to policies on packages coming from other countries going through Kunming customs? We have lived in China for 4 years, and have never had customs issues until our most recent package. This package has only a small amount of kids clothes in it, but they are still taxing us on it. They told my husband that as of October they have started checking every package coming from another country and that all packages will incur a tax no matter the value. I can't decide if we misunderstood them, or not. Has anyone heard anything or experienced something similar? On the flip side, has anyone received packages without any issues since October?

I have received a few packages since then. Some taxed, some not.
If you're mentioning the value of the items on your package slips then they are entitled to tax you, as an import tax on certain items.
The trick is to weigh up is it worth stating the actual value, there would be no tax or less tax if you made out the items to be used, you are reuniting items from overseas, or dressing items down. Also if you are staying the value in dollars then this makes things easier for them, if you don't come from a country that uses dollars, then state local currencies and you'll find tax is less likely.
If you are having your mates back home send them to you then this is all very well, if you are buying them from a company and asking them to post overseas, then they probably aren't going to do any of the above for you, so bare that in mind.
What you also want to weigh up is would it be worth putting other values on the items. If the package never shows up then you can't ask for a full refund on a 100 euro watch if you stated it was only 20 euros. So you'll have to put some thought into what you would be willing to write off if it ever came to it.
What I have noticed is that things are taking much longer in customs than usual, however I have been taxed on packages since I can remember, going back years and not just here. So you'll have to get creative.
Also don't miss items out to avoid tax, if you sneak something in and don't state it on the slip 90% I'll go missing during its journey. Make sure you list everything youre sending.

Anybody had problems receiving books from overseas?

You can get taxed on anything over a certain quantity or worth including books from overseas (not sure of the exact details)

I am curious about search-&-seize of books on the basis of apparent content.

Never had a problem with books and have imported a fair few hundred this year, 1 or 2 with possible dubious content. I can't see anyone searching through foreign language books on the off chance.

I still haven't received the Codex Sinaiticus I ordered last year from Taobao