Do they? Gamestores changed from 95% being about games to 40% games and 60% merchandise and other stuff. Why sell only digital consoles anyway especially when physically sales seem to shrink on average year by year;..
Exactly right. I've heard this argument about retail not selling products which will come to compete with themselves far too often. Not only - as you point out - is it contradicted by their current practices, but it also presumes a level of strategic power that retailers simply don't have.
Even if they believed they could actually influence the install base (which given how many routes there are to buy a console, is highly dubitable), it would have to be by enough for it to be worth sacrificing the margin on the console, and the margin on all the extras you could have sold the guy coming in buying one, (a charger, a headset, an extra controller etc.), and explicitly send him to another retailer who does sell the cheaper console he wants.
So yeah. NO.