Others have noted the digital download bar that Wal-Mart needs to climb. One word: Apple.
But I see some other not insignificant barriers to entry as well:
1. Wal-Mart's core constituency is still somewhat rural and small-town. There is significant lack of overlap between the demographics of customers who stop in these stores and the availability of broadband necessary for the best downloading experiences for these titles.
2. The prospective customers who would be most attracted to joint download/in-store DVD purchases might not be a perfectly overlapping demographic mix with ready access to Wal-Mart stores. I know I am overgeneralizing, but the high-tech resident of a remodeled loft in a latte-sipping, restored urban neighborhood as well as the digitally downloading upscale family- well, will they drive 12 miles out to an exurban interstate interchange to find a Wal-Mart? These are IKEA shoppers, not Wal-Mart shoppers. And there are more than a few from this group who resist shopping @ Wal-Mart on ideological grounds.
3. Wal-Mart has not proven the most socially tolerant distributor of creative works. So let's say there are these movies where some bad characters constantly repeat that most vulgar of incestous accusations. Can't you just see Wal-Mart playing censor?