I'm a fan of local the local LDS (and LBS, for that matter) and try to shop there when I can. I realize that they have additional costs (lights, staff, rent, etc.) and I appreciate that I can talk to someone who (hopefully) knows their stuff and that I can put my hands on whatever widget I'm looking to buy. As well, post-sale service and training has some value to me. However, my largesse only goes so far-- my own general rule is that if I can get something from my LDS within about 10-15% of what I'd pay online (and I usually consider shipping and tax to be a wash), they'll get my business. However, if they try to take advantage of me on price, I'll take my business elsewhere; I've been diving long enough that I pretty much know what I want and have enough experience that I can reasonably research something online. The reality of the modern sales model is that the internet marketplace is here to stay, and brick and mortar shops need to accept that and change their business methodology accordingly.
One other thing that I tend to believe is that if the LDS can get their price low enough for me to pull the trigger, they'll still be making money in the long run. I'll come by for widgets (retractors, masks, booties, etc.) that are just not worth buying online and will also tend to use the LDS for vacation planning (assuming they have a travel desk) and refresher training for my wife-- treat me right, and I'll be loyal (within reason). Try to screw me over for a quick sale, and I'm out the door.
Just my 0.02.
R.