Showing every SKU, of course, is exactly the Amazon approach - 'the everything store', and it works well for some categories, and especially when you know exactly what you want. But knowing what you want is not necessarily the starting point - that's what needs to happen along the funnel. Amazon's relative weakness at curation, discovery and recommendation (I've seen data suggesting the recommendation platform is only 1/4 of its books sales) is, I think, a big reason why, after 25 years of ruthless and relentless execution, it's still only got to 25% of the print books market in the UK and USA. A bookshop (or any shop) is, yes, the end-point to a logistics system, but a good bookshop is primarily a discovery platform. That is, it's more about the tables than the shelves. And the tables are lists, not inventory.
Lists are the new search
I've become rather fascinated by all the people trying to unbundle Yelp for restaurants. People trying to unbundle Craigslist do so with modern UX, but Yelp is a modern company with modern UX, and the people unbundling it, mostly, use constraint.