There seems to be some confusion about the use of the words "less" and "fewer".
Strictly speaking, that sign should read "10 items or fewer".
I have heard of someone who refuses to shop at certain major supermarkets because of the grammatical error - but I think that is going a bit too far!
Basically, the rule is: "If you can count them, use the word 'fewer' and if you can't, it's 'less'.
"Fewer cars on the road results in less traffic. This means less stress which, in turn, will result in fewer headaches."
I don't think it really matters which word is used, so long as it is understood and observed.
It is infuriating waiting, with one item in your hand, behind someone who has 20 items in the "10 Items Or Fewer" line.
And, of course, most cashiers say nothing.

How would you respond to the suggestion that "10 items or less", "25 words or less", etc. are shorthand for "10 items or less than 10 items", mutatis mutandis for the cetera?
Such expressions appear to me to be the disjunction (OR) of a quantified noun phrase "N thingummy-bobs" with a word very connotative of intended sense, yet not a full NP to balance the prior disjunct. Perhaps wrongly I wiff elision of something here. Why not "less than N thingummy-bobs"? Indeed, if that is what is being left out, I totally approve.
We can also say "married these last 25 years or more". Or should that be, "25 years or greater"? Of course not.
I'm sure you're right that *"fewer traffic" and *"fewer stress" are infelicitous. Also, "greater cars" and "greater headaches" would intensify rather than multiply cars and headaches.
However, I think "less cars" and "less headaches" are not only used often, but can be parsed acceptably. "Cars" and "headaches" can be thought of collectively, not just countably: "It's the cars that make all the noise." Are we counting cars in this case? "My wife's headaches are really getting to me." Is it their number or the correlation with bed-time that's causing concern?
My guess is English doesn't like using count quantifiers with mass nouns, but it can tolerate qualitative quanitifiers with count nouns considered abstractly.
But unless Woolworths can demonstrate they've consulted the appropriate linguistic authorities, I agree, they don't deserve to use such a phrase. Mind you, I'd probably have to get serious if they took the signs down. It's a jolly good idea, whatever language it's expressed in.