Not really knowing how any of this works, could Google just stop listing other merchant's stuff and be in compliance? Obviously it'd take a hit on search value

Not really knowing how any of this works, could Google just stop listing other merchant's stuff and be in compliance? Obviously it'd take a hit on search value but I don't really understand how rating their stuff higher is any different than having a product page in the technical sense except that they also list other people's products. So I'm not sure if this is due to their size and adoption or if it's because they are a search company that lists everyone's products. I really have no idea about this and no real opinion, I am just wondering if hiding other people's results would solve this.