I deal with Walmart toys practically every day. I teach guitar for a living and expecially at this time of year there's a lot of new kids starting up because somebody bought them a guitar for Christmas. Unfortunately Santa shopped at Walmart and just got them a toy guitar. The parents always say "Well, she can start on this and we'll get her something better if she sticks with it." That's usually the point where I explain that first of all she won't stick with it because it's unplayable - not just hard to play but the frets are spaced incorrectly so it's not possible to play in tune, and then point out that they could have bought a real guitar (not a good one, but at least a real one) for $50 at a music store and it would have a warranty with it.

Whenever parents talk to me before buying a guitar I simply say that the Walmart/Radio-Shack/Giant Tiger guitars are just toys, not guitars, and they seem to understand that.