It should be obvious to anyone, willing to view Walcott with a little bit of objectivity, that right now in 2012 he has great pace, good movement in the final third, times his runs excellently, generally has a good first touch, and is a top class finisher.
Based on that alone, it is reasonable to think there is enough in him to get a better than decent player. If you also, as any Arsenal fan should be able to, factor in that he has developed a lot every season and that he is still only 23 - then we should do what we can to keep him.
13 goals at age 21, 11 goals at age 22 and 7 goals so far this season. That is a GREAT return for a wide forward, and then we are not even taking his assists into consideration.
Having Theo in the team of course means you have to balance the team somewhat differently than with a Mata or Nasri in his position, but it really isn't that difficult.