I don't agree Walmart would make for a textbook example. I'd argue they were/are not even a monopsonist with regard to their suppliers. They might be a strong regional force but they have failed (or chosen) to move out of their regional power position. That's not a bad thing and in fact is a strength. I'm pretty sure they were cited as an example of good strategy for exactly that in "Competition Demistified" but don't have the book with me right now.

However, in the day and age of modern logistics I'd argue that their suppliers could have sold to other customers in other states.

Ultimately I suppose it depends on how we define a market (ultra regional or wider) and how high the transaction costs (+other extra costs) of the suppliers would be to move to another customer. The classical example in "The Economics of Imperfect Competition" was the labor force in a small town (mining iirc., once again not at my bookshelf). I suppose that would give precedent to the fact that small markets "count". However most studies on the topic I am aware of are about labor not supply/demand structures. And I'd argue it is "easier" for a supplier to move their wares to another customer than for a (specialized) worker to move to another company (uproot family etc.).

Additionally some of the suppliers of Walmart are in pretty strong negotiating positions themselves (Unilever etc.).

At least there's enough doubt in my mind to say Walmart's supplier relations are "a textbook example of a monopsonist".

Great for end customers at first, but then what are you left with.

Why is arbitration so bad exactly? The implication seems to be that Amazon has a better chance of winning, but I never see how that is backed up.

European gentry also ruled their local underlings, who had no access to the Kings Justice. There is precedent. Welcome to Amazon-land.

I'd be interested to know if this is a problem in other countries.