I have made jackets out of the sweatshirts from Walmart, too...I ended up putting a band on the bottom on 2 of them. The third one, I left the band on. and stretched it a bit to make it square. Worked well.
BTW, I turn my sweatshirt inside out to stitch on. This way the "lining" of the jacket is the outside of the original sweatshirt instead of the fleecy inside of the shirt.