For many stores across many industries, having enough stock of popular items subsidizes the ability of the store to stock rarer and less-often selling stock.
I probably spent 30% of my student loans on books at borders because I'd have a hard time waiting to get home and buying from amazon. Plus like you said the 30% coupons made buying from amazon a waste of time. They changed that for borders bucks which I think was a major mistake. Bring back the coupons.
Cover out sells a lot more books, so the publisher will insist on certain books being displayed like this, or prominently on 'new book' stands.
Sometimes the publishers pay for this service, but more often it's blackmail - "put our new diet book cover out or you will get the next Harry Potter book a week later than Amazon"
Borders was a revelation when it opened. I'll miss it if it disappears.
However, this site lists some current coupons: http://www.dealigg.com/story-Borders-Coupon-Code-Discount
I never buy anything at Borders without a coupon.
Borders in San Antonio has a large selection of said topics, and I'm impressed. The only thing about Borders that bugs me is the lack of sitting areas.
I wonder if their demise would actually be good for a lot of independent booksellers whose customers would avoid B&N.
I know several datacenters are in San Antonio. MSFT, Rackspace, etc. Also, the NW side has a medical center, a university, and several banks (USAA's HQ is a mile away from it).
In short, the NW side is an affluent area.
Their books were overpriced, of course, but they actually sent out 30%-50% off coupons weekly, bringing them basically to Amazon's levels - so while I did the bulk of my book-buying on Amazon, I really enjoyed dropping into the store every week or two and browsing for something fun to buy.