This is like salt on the wound isn't it? First they undercut everyone and drive 'em out of business then they open up a shop of their own. The only thing worse would be if they opened it at the same site as a bankrupt B&N store.
Of course Amazon can offer cheaper products. They have grown to be a massive company, nobody can compete with them now and they make a massive profit that goes to the company owners.
Ignore the consumer. What about the bookstore owners who used to make a living and had to close their business because a bigger company basically put them out of business? People who might have worked generations there, perhaps even had family run businesses. Previously the income/wealth would go to many bookstore owners, now it goes to one entity - Amazon. If you don't see a problem in this simply because "hey, I get cheaper stuff, that must be good right?", then I am quite sad.
Not everything that is good for the consumer is good everyone on the way. Please remember that.