I, too, am a big believer in buying locally when feasible. Not only for all the reasons given, but for the service level you achieve. But service comes with a price.
Looking at the figures you gave, I would expect the local place, given all the information, to at least match it's own fall sales price. That would be a $50 discount.
But let's look at the relative figures. With a $549 list price, and assuming the restaurant supply store is buying direct from the manufacturer, their purchase price is about $357. The internet site can sell it for $409, because they don't have the overheads and business costs of the local shop (in fact, I'd bet a good steak to a stale doughnut that the internet "store" has it drop shipped). So it's unreasonable to expect the local store to match that price. But, $150 is a lot to make on such a unit, particularly if that sale leads to you becoming a regular customer. I would expect they could go to about $450, but that $475 is more reasonable. That would be the best deal for both parties (which should be the goal of any negotiation).
Negotiation should not be thought of in terms of "how cheaply can I get it." Rather, it is the art of the possible. And that's what you should be looking at; what is the best possible total deal. Among the things that go into "total," is the warranty coverage. If you have a problem with the internet-bought unit, you'll have to ship it back to the manufacturer. With the local place, just return it. How much is that worth to you? Learning to use the machine is another aspect. With the internet you're on your own. With the local store there is back-up expertise. And so on.
So, let's assume you can get it for $475. While 65 bucks is nothing to sneer at, is it worth the loss of service and good will? Only you can answer that, of course.