So the two remaining purposes are to let Amazon know which parts of Netflix library are valuable enough to fight for versus not bothering [...]
So Amazon outbid Netflix for the Nickelodeon and Nick Jr. content (Dora, Peppa Pig, etc) that my kids love and then stuck it behind special monthly additional service (Freetime unlimited $5/mo without Prime and $3/mo including it). For now I can get the PBS content Netflix, and there are other options for the adventurous watchers that are great.
So this is the future, folks - yes, they'll bid for content, then essentially create another "channel" on their service.
Fractal balkanization, each layer costing the user more (and in the case of Amazon Prime - still not available on my Apple TV so requiring another device).
What's a non-pirating parent to do?