Wal Mart will likely not be able to use the raw images. They are unique to each make of camera – unlike JPG or TIFF which are standard image types. You must process them to get TIFF or JPG.
You will find that your 5Mp raw images decompress to 14.4 Mb TIFF files, which is about the size Photoshop will decompress your JPGs to when it opens them. So your compression is a lot more than 3:1. 1.5Mb seems like too much compression for best quality. You don't say which camera you have, but any 5Mp camera with raw capability should have a better quality JPG available to you. Fuji is busy using smoke and mirrors to up their MP and they use an extreme compression so you can't directly compare, but I don't think they make a 5Mp camera.
Just call Wal Mart and ask what file size they take – I've read they have a limit. When you process your raw images be sure to save the originals – they are your digital negatives should you ever want more than a 4 X 6. Same for the JPGs from your camera – save the originals regardless of what you do with the cropping and post processing.
You won't see any difference between raw and JPG for small prints. You will with large prints - especially with the high compression you are using for JPG. Some cameras handle raw at a higher bit rate giving a little better color if you decode them to 16 bit.