Well first off you're thinking with a very short sighted perspective, no offense. I've personally seen 1080i HD MPEG4 at 500kbps. It's not widespread by any means, I saw it in a lab at a university. However, we are moving towards better and better compression, which will ease the bandwidth requirements.
Also, with multicasting you would not need hundreds of individual streams for a particular node. In fact, you would end up with about 20 for the 500 homes you're talking about, on average.
Lastly, bandwidth is ever-increasing. 10Gbps fiber rings are getting cheaper by the day. Sure, we're not at the point where you can get 10Gig to the home, even with FTTH providers, but the point is that it isn't that far off. Cable companies are already going 100Gbps over their national video rings. QAM-512 modulation will help the people who only have RF to some extent, as well as bonding. Aside from all the details though, the point is that the streams are getting smaller and the tubes are getting bigger. It is going to happen.