Yeah, it's actually kind of surprising that it took this long for Rancourt to have to comply. Retail markup is generally between 40-60% depending on the industry (I believe 40% is standard for books, 60% for clothing). The contracts are usually written such that the manufacturer isn't allowed to sell the goods for less than the retail markup, otherwise they'd be undercutting the retail business. That's why most manufacturers don't just go out and sell their goods for super-cheap. This is also the reason why LLBean has never used third-party distributors, and so they are able to sell made in USA boots, standard for so cheap.
The flip side is that the retail guys put up lots of money for orders up front, and are much, much more effective at selling their goods. They take on the full risk of selling the things. Rancourt certainly has a good following of people who prefer the MTO process, but the vast majority of sales are people who get them at Brooks Brothers, Jack Spade, Eastland, etc. Remember, until a few years ago, no one had even heard of Rancourt, because they were behind the scenes, providing their shoes to all the big name brands. There just aren't enough shoe-focused men out there to support a fully MTO shoe-business. But for those of us who do, it's totally possible to talk to Kyle if he's in (or at least, it used to be). Kyle has said that every single MTO shoe gets inspected by him before it goes out the door, but that the retail ones are inspected through automated processes.
Anyway, the point is that the contracts require Rancourt to have a calculated, standard MSRP, and that they have to comply with it. At the same time, since they now competing against companies that have really strong economies of scale on shipping, they have recognized that they can lower their price (and removing a psychological barrier) by hiding the shipping cost. It also probably saves them hassle, because people want free shipping and are probably constantly asking for free shipping codes.