You've made the same mistake here most toy retailers do at the store level. The fact is that collectors do exist and this is the store chain which short of TRU, has had the most store exclusives. Not only are their head office aware of collectors but they've marketted to them. As such it is entirely reasonable for Target to be aware of the basic fact in collecting that packaged toys cost more than loose toys. If I'm not about to pay the same price for a figure that's effectively loose as I would for a sealed figure, then why should I do so in a store?
Forgetting about collectors for a minute though, what about parents? How many parents are going to be buying toys as presents for kids and how many of them are going to pay $25 for a toy that has it's packaging ripped to shreds when they can walk a few hundred metres down to Kmart and pay that as normal price for a deluxe? That's the first point to this.
Secondly, Target are in the middle of a Toy sale which they're now extending. The whole reason this is happening is because Australian retailers are suffering badly from people voting with their feet and buying online and internationally. So the idea of them wanting business right now is a pretty reasonable one.
You mean besides the fact that this happened at Target and during the toy sale, or the fact that toy sales are being extended because of how poorly retailers are doing compared to online international toy shopping atm? Furthermore, how is this any less relevant than criticisms of Target's refusal to price match with BigW during the toy sales?