The England winger has been pleading for the central striker's role for some time and, playing in his new position, Walcott proved he has what it takes to fill the boots of the London club's all-time top scorer Henry.
"He can play through the middle. I am convinced of that," manager Arsene Wenger told reporters after Arsenal climbed to fifth in the table, 16 points behind leaders Manchester United.
"He can only get stronger there. He has done very well and it just typifies what I think he can do."
Walcott was on target in the 20th and 73rd minutes before adding his third goal in stoppage time.
Olivier Giroud (two), Alex Oxlade-Chamberlain and Lukas Podolski also struck for Arsenal while two-goal Demba Ba and Sylvain Marveaux replied for Newcastle.
Former France striker Henry, who hit 228 goals in all competitions in two spells with the club between 1999-2012, applauded from the stands as Walcott produced his outstanding display in attack.
The 23-year-old burst free down the left and cut in to deliver a clinical finish beyond Newcastle goalkeeper Tim Krul for the opening goal.
Three times Arsenal led and Newcastle hit back to equalise on each occasion before the visitors were finally buried under a late avalanche of goals in an end-to-end encounter.
Walcott's second effort was a powerful close-range strike into the roof of the net but it was his hat-trick goal that had the stamp of Henry at his best.
ACUTE ANGLE
The England international weaved his way round three defenders. He then stumbled and fell to the ground before picking himself up to delicately lift the ball over Krul from an acute angle.
Walcott, at the centre of a contract dispute with Arsenal, cradled the matchball in his arms as he lapped up the adoration of the crowd at the end of the game.
He bowed and clapped all corners of the stadium while cries rang out of 'sign him up, sign him up, sign him up'.
"I think he loves the club and the club loves him," said Wenger. "My desire is to extend his contract - I think he belongs here and hopefully we can do it."
New York Red Bulls striker Henry, who is training with Arsenal during the Major League Soccer off season, has been working closely with Walcott behind the scenes.
"I believe Theo takes advice from Thierry," said Wenger. "It's good when you need to talk to someone who has played in there [as a central striker]."
Walcott said he was delighted with his performance and that of his Arsenal colleagues.
"I've always said that I'm a striker," said the former Southampton winger who wears the same number 14 jersey Henry used to parade. "I'm not saying I want to play there all the time but it's an option for me and the team.
"It was a manic game today, it was so open and that played into our hands. Newcastle have got some top quality players and they play some good football at times but as soon as it went to five we could see some of their heads dropping."
