Smart move. Give em 2 years and they'll leave Amazon in the dust.
I don't know whether they will be able to overtake Amazon or not, but for sure the Overstock CEO is a very genuine guy and they are very innovative. Their business will grow much faster than that of the Amazon.
They'll never get anywhere close to Amazon. Amazon is the greatest of all giants as a merchant and is pretty much untouchable regardless of wether they accept Bitcoin or not. If Bitcoin keeps growing to where it is large enough it's probably only a matter of time before Amazon starts accepting them though. I'm sure the benefits will present themselves clearly over time and they'll regret not getting in sooner. I bet they're watching Overstocks acceptance of them quite closely.