The problem in this scenario is that the biggest player will still have an opportunity to dominate. Proof of work blockchain? Well, Amazon just has to outspend all the others—which they can handily do, or run computation on AWS. Similar with staking, except worse because more money = more direct influence.

Not necessarily, it greatly depends on the incentives the system is setup with and how distribution of the token supply goes. And if you use PoW, PoS, DAG, or other systems. If what you are saying were true, Bitcoin mining for example would be entirely dominated by Amazon or some other major player, but that's not the case. It's a lot more complicated than just more money = dominance of the system. With Blockchain, we can have the participants in the system vote on how the system is administered in a more democratic and transparent way than amazon reviews or central banks or name your existing structure. It's just a matter of how it's all setup from the jump and how those incentives shape behavior in that system. Just like capitalism's starting parameters and current legal environment (like concepts around the shareholder corporation) encourage the formation of monopolies, consolidation of power, and "externalizing" costs like destroying the environment to make 10c more per unit.

Our local stores, as discussed in other comments, can’t even offer shipping or workable websites. And we expect them to self administer part of that blockchain? They are just going to pay Amazon to do it.

One benefit of Amazon, eBay, etc is that companies producing goods no longer have to administer their own website, storage, or logistics chain. Amazon has resulted in massive efficiency gains both economically and environmentally (depending on where you draw the box of course) for these kinds of businesses. I don't expect small companies to be developing the blockchain, just using it as a turnkey system like they currently use Amazon, Facebook, and other tools in their tech stack. They would however be able to vote on governance decisions like for example what fees exist in what categories or what rules shipping suppliers would have to abide by or how much to incentivize greener shipping methods etc. Consumers could also vote. It all depends on how you structure the system.

And big data companies like Amazon would love to peer into the blockchain and see the throughput for each of these competitors and discover patterns. Edit: and they already do that for vendors selling on Amazon, which is where all these Amazon-branded products come from.

Ok sure. This evens the playing field by giving all parties access to this information instead of it being monopolized by Amazon et al. One of the great ineffiencies of capitalism is the siloing if information. Company A needs to compete with Company B which needs to Compete with company C yet none of them know what the others is doing or how the market is responding. And really the only way to test some of this information is to bring a product to market and potentially waste millions of dollars and countless environmental resources building a product there is no demand for or which there would be demand for if Company B hadn't also come out with a very similar bug slightly better product at the same time. You could also add some privacy and obfuscation layers, for example, I don't think consumers want everybody on the blockchain knowing what brand of sex toy they prefer.