Very good points. Another advantage walmart has is their "ship to store" option, you order stuff and it gets shipped to a walmart and you pick it up. I do hope it will be a price war,and not a legal war. A price war is good for consumers, a legal war is only good for lawyers.
But there are tons of other retailers also offering Free Shipping. They had to do this to compete. There are so many deals this xmas due to the recession. Goto a site like http://www.realdealgrabber.com and you will see so many awesome deals. Many with free shipping.