Basically, this is just another part of the ME generation of parents (of which I am a part of).
I am old enough to remember going out and it being an absolute SIN to act up in a public place. I remember sitting in my family doctor's office and reading the sign he had posted that said "Children Should Be Seen and Not Heard...". As an 8 year old, I thought that was the meanest saying! That was the thought process in the late 60s and early 70s. Honestly, I cannot remember stores being so overrun with whining children as they have been recently.
I have commented on several other DIS threads in the past with regard to whining children in their obnoxious parents. There are specific stores where this goes on all the time, and Wal-Mart is one of them. I believe in the majority of cases, the parents choose to be there, with their tired, cranky children, because MY GOD it is their right to be wherever they want and do whatever they want and to heck with everyone around them. I have the worst experiences at Wegman's grocery store on Sunday morning. It is FULL of tired, cranky children. The best part is, BOTH parents are out shopping with the three whining children because it is FUN for them and they consider it an outing. Wegmans, after all, is a "destination." Little Johnny and Susie just love the fire engine shopping cart.

And they proceed to whiiiiiiiiiiiiiiiiiiine, and scREEEEEEEEEEch, all through the store. Why couldn't one of them stay home with the bored kids? Because probably one of them is afraid to be alone with their own kids. Who knows.
At any rate, in most instances, the prolonged whining can be attributed to a parent who doesn't want to give up his/her outings or change their schedule because the kid is tired. We all can tell the difference between the parent that is browsing through the aisles distractedly trying to shush the whining and the other parent who is standing in line waiting at the pharmacy for medication with a sick/crying kid.
As for the old lady, I would have been secretly cheering her but I would never confront anyone like that. Without hearing her tone, I can't judge whether she was rude or not.