I don't mind beating dead horses, and this strikes me as being quite civil and interesting, so I'm all for continuing.
They're artificial barriers, certainly. And I'd love an open App Store, though I understand their reasons for keeping it locked down. The worst barrier they have right now, IMO, is the single-carrier barrier, which I really think is flat-out wrong. But the USA is rather backwards when it comes to cell phones.
As to the WalMart / other contrived analogy, which I admit my comment was rather lacking in content, lets try another comparison. The DS only plays DS games (especially with the DSi now, which loses the GBA slot). However, not only is that the same restriction, it's even worse because getting permission to sell your game is an absolute nightmare if you're not big, and the development tools are far more expensive.
To make the comparison stronger, and the App Store's position worse, the DS has sold three times as many units than the iPhone, though probably not as many cartridges as apps. But that's physical vs digital distribution for ya. How often do you hear about the DS and its far tighter distribution chain, as opposed to the iPhone? Granted, the App Store has been changing lately, but the criticism hasn't abated since day 1.
For WalMart in particular, I'd say it's closer to buying a DVD player from WalMart, and having it only play DVDs sold at WalMart. It'd certainly suck for people trying to sell things, but they carry 99.9% of what people buy anyway, so most of the buyers won't mind (and it may be worth avoiding the huge amounts of porn that might appear there otherwise). And there are other options, like Android phones, Blackberry / PalmOS based phones, etc, which match other retail options.