Jonah,
Now I see your problem with the strawmen Rod keeps setting up. Mom and Pop video stores started failing when Beta-Max went out. Many more failed when the Movie companies started marketing directly to the public, and dropped their price point so that buying a video became easy and less expensive. Not to mention Blockbuster and Movie Gallery national chains moving into every town in America with a population of over 20,000. And the technology switchover to DVDs drove even more of them out of business. But we're supposed to believe that Rod is sweating the morality of patroning Netflix? Gimme a break...
And for the record, from what I've seen over the years, the most successful small independent video rental places always deal heavily in porn.