From a UI perspective for user it looks like the "Search Google or Type URL" text are would be searching the Amazon.com site - however it sounds like it searches Google?
My guess is that this will drive a lot more traffic to Google and then much more opportunity for a website to the lose that user because Google will be able to show other listings - including ads - prior to showing whatever is on your own site, even if is only your website in search results (which as I said before, looks like won't be the case).
As a developer and website owner this would motivate me strongly against Google and strongly turn me off from Google if they continue to try to funnel traffic back to their own website.
It's right to address this behaviour in the interface design. Rather than somehow telling users they're wrong Google can work with that behaviour. Yes it has benefits for Google in tracking and profiling user behaviour too.