Disclaimer: I did not realize until I was well into Spindle (Kingdom of Sleep) by E.K. Johnston that A Thousand Nights (also by E.K. Johnston) was a companion novel which takes place prior to this one. That being said, I do not think that having not read A Thousand Nights detracted from how much I enjoyed Spindle. Spindle is perhaps the most enjoyable retelling I have read from the genre in a long time.
The world is made safe by a woman…but it is a very big world. It has been generations since the Storyteller Queen drove the demon out of her husband and saved her country from fire and blood. Her family has prospered beyond the borders of their village, and two new kingdoms have sprouted on either side of the mountains where the demons are kept prisoner by bright iron, and by the creatures the Storyteller Queen made to keep them contained. But the prison is crumbling. Through years of careful manipulation, a demon has regained her power. She has made one kingdom strong and brought the other to its knees, waiting for the perfect moment to strike. When a princess is born, the demon is ready with the final blow: a curse that will cost the princess her very soul, or force her to destroy her own people to save her life. The threads of magic are tightly spun, binding princess and exiled spinners into a desperate plot to break the curse before the demon can become a queen of men. But the web of power is dangerously tangled–and they may not see the true pattern until it is unspooled. (Chapters.Indigo.ca)