All- good answers to my honest question. The same logic would apply to free trade and I support free trade.
Except that, in the example, the out-of-state guy is not undercutting the in-state guy on price, quality, or service. The only advantage the out-of-state guy has is that he does not need to charge sales tax, but the in-state guy does. Assuming that both the out-of-state guy and the in-state guy charge the same amount for the same item, that means that the out-of-state guy's products automatically cost the consumer ~3-8% less (depending on the state), purely because of differing tax rules. That is NOT a "free market" situation, that is a disparity CREATED BY the government.
Also, it's worth noting that in nearly every state, internet purchases (and mail order purchases, etc) ARE taxed. Merchants are not required to collect the taxes, but people are supposed to report such purchases (although, of course, many don't). In some ways, these proposals are really tax collection measures rather than new taxes.