Do you need 2000 square feet to see this?

It’s been one of the more puzzling aspects of Barnes & Noble‘s move into the future: Why are they giving up thousands of square feet of prime bookselling space — the area just inside of entrances, which have the highest sales-volume-per-square-inch of any area in the store by far — to displays of, well, one simple, not to mention small, product: the Nook. Here in New York, the Union Square B&N has turned at least 2,000 square feet in the front of the store into a barren-looking area with nothing to show but a few lonely Nooks and a handful of staffers standing around waiting to explain it to … someone. But it’s an area resolutely bereft of customers. They’re all off in other areas of the store, looking for the new books that used to be displayed so temptingly where you walked in. Meanwhile one can easily imagine those interested in reading on a device are shopping for that device … online.

So why is a company that has historically been so smart about the nexus between sales and in-store geography willing to lose so much money in the midst of an economic crisis?

For this observer, it’s been one of the signs that B&N is looking to get out of the bookselling business, or at least the brick-and-mortar end of it, as fast as possible.

Not fast enough, according to a Wall Street Journal report by Jeffrey A. Trachtenberg that says the company “will double the size of its Nook boutiques in 40 of its most productive stores nationwide over the next few weeks in time for the holiday selling season.”

As he notes, the company’s Nook “boutiques” “typically occupy 1,000 square feet in the 704 consumer stores nationwide …. Barnes & Noble will now increase the boutiques at select stores to an estimated 2,000 square feet, it said at its annual shareholder meeting.”

While the B&N statement insists it “will do so without reducing the number of physical titles it stocks by using space formerly allocated for such products as music and DVDs” — something I’m not sure I believe given their stunning return rates of books this year — my guess is the move still represents a significant loss of income for America’s only remaining chain bookstore, all the more so as it’s the holiday season.

And that’s not all. Trachtenberg reports that the company announced plans to broaden “the assortment of non-book items it sells,” and will be dedicating another 1,000 square feet in more stores for its “toys and games offerings.”

While the company — and Trachtenberg — couch B&N’s “non-book item” growth as preparation for the pending release of a Nook tablet, and in general as a reaction to the “intensifying competition from Amazon.com Inc. on both the e-reader and digital books front,” our attention may be better directed to  a close reading of the WSJ report’s last line: “Barnes & Noble helped pioneer the book superstore with its huge array of titles, but the popularity of online book buying has made it difficult for any bricks-and-mortar bookseller to compete on an assortment basis.”

We think: Not really, and in any event, not for long.