They key problem in this mess isn't Netflix using up so much bandwidth (they aren't pumping things out, consumers are pulling things down)... it's actually Cogent. Cogent is clearly not paying to keep up with the data Netflix is consuming. Cogent needs to pay Verizon more to ship the data around (according to their peering agreement)... and should probably pass that data cost back onto Netflix which will force Netflix to find ways to balance out the bandwidth they consume.
Netflix's proposed solution is a legitimate strategy that reduces congestion and helps both Netflix AND the ISP they place with. The ISP receives less inbound traffic (usually good for their peering agreements), the ISP's customers get access to a service they desire, and Netflix is able to place some cheap servers.
Netflix is not a victim, I agree... but neither are they some type of protection racket trying to force tier1s to place their server. Netflix would be no threat if people weren't subscribing to it, so your analogy is a little off there.