While I think this is pretty much a bunch of gobbledygook (SP?), there may be a reason why it might actually make some weird kind of sense: the fact that bloggers, on the whole, at least when it comes to beauty/fashion blogs, often actually test-drive the products before they write about them, whereas most beauty/fashion mags don't test out or review the products when they feature them in their beauty pages (although I think some magazine readers might be under the impression that they do). I think that on some level it should only be fair, in the name of giving a product a fair review, that they should divulge that they're getting the products for free (although most readers would probably assume that anyway).
All in all though, I think this disclosure thing is really all about something else entirely: the fact that people are afraid of this new media and they're trying to police it any way they can. And the way things are going, they probably have a right to afraid.