My experience is that it works like this: you have the retailers and discounters, who generally give either a percent off cover price, or a fixed sticker price below MSRP (i.e. Titan Games, Crazy Eddie's, etc.). Selection there is decent but spotty. You also have the distibutors, who have entire lines in stock, but generally do special offers in lieu of discounts (i.e. package deals, prizes for games, giveaways, etc.). Almost all of the distributors give a discount on tax, so that you pay the cover price and don't have to hassle with adding 6% or whatever. Some of the smaller game companies don't do giveaways, but do more in terms of demos.
Hope that helps.
. . . . . . . -- Eric