Bought a leather couch from Palliser for $1200 six years ago, and it looks and feels exactly the same as the day we bought it - and that's in a household with 3 kids under the age of 7. We got a wicked warranty on it as well; basically, even if one of my kids sticks a knife in the thing, they'll come fix it.
In most cases I agree that quality costs more, but you don't have to spend stupid money to get nice furniture. I would imagine that people who buy the throw-together stuff from Wal-Mart know they aren't getting something that will become a family heirloom.
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