The American Medical Assn. opened its annual policy-making meeting in Chicago to consider such diverse issues as a complete overhaul of the Medicare system and shutting down adult book stores to stem the spread of AIDS. Also on the agenda at the five-day AMA House of Delegates meeting were proposals to discourage advertising alcohol to young people and to allow acquired immune deficiency syndrome-infected children to attend school. The group is also expected to draft a report calling for fewer medical school admissions. The 388 delegates are from state and regional medical associations.