The advantage of these stores is that, as a nerd, I'm pretty much at least vaguely interested in every book they have there, so the serendipity in browsing is high. Also, these places have used copies co-shelved, which just increases the odds that I will pick something up randomly.
btw, across the street from powell's tech is the flagship powell's, which has 1 million books and like a whole room full of english lit: http://www.powells.com/pdf/burnside_map_2011.pdf
My second-favorite thing is browsing a (relatively) small selection; Amazon is so amazingly huge that I'm not sure where to begin, but browsing a dozen shelves of <insert interest here> is fast and easy.
Also, a LOT of books are bought as gifts, and gifts books are usually bought by browsing.
Still, I don't see many bookshops surviving either.
The only reason that comes to my mind is the joy of browsing, maybe buying something you've seen somewhere recommended before. Are impulse buyers a huge part of the market?
I've been to a local private bookstore twice and the only customers I've seen there are people who probably prefer face-to-face and resent the distant and modern way of buying things, where the only social interaction is saying hello to the mailman.
Could the bookstore provide me with anything amazon couldn't? Books that were unavailable to amazon were unavailable to them. Imports took even longer and due to not living in an english speaking country, 99% of the books on the shelves were translations which I don't want to read. Which is even more of a problem in bookstore chains. We have one with four large floors and a café. How many shelves of Twilight in German the day on release? About 10. How many shelves constantly filled with english literature? 1. Out of a number that probably goes in the hundreds.