because Amazon uses their non-retail business profits to identify high selling items, produce them themselves, sell them at a lower price (because they have all the data also), and finally steer customers to those products. They're the market place and a player. This new idea isn't well defined in law, but using your profits from one company to undercut another area is illegal.
> "by the rules"
is the same idea as "illegal", and even if they're not, the point she's trying to make is the fact they are not breaking rules should be setting off alarm bells because...
> "but why is that a concern of the government?"
because America loves the free market, and big business is the enemy of it.