I live in AZ and our walmart remodeled and kept a fabric dept. It is far smaller then we had, one aisle both sides and some barrells with bolts or other fabrics. We have a cutting table, but, I notice more fabric that would be used for kids patterns. Ours was probably kept because there is no real place to get fabric other then to travel 50 miles or more and we have both a school (home economics) and a reservation that buy lots of fabric from walmart.
I also just returned from our holiday travels, visiting family and Tyler, Texas Walmart still has fabric as does Brownfield, TX