> Couldn't you same the same thing about a cheap DVD player and used DVDs
Not really no. When you play a game you're going to spend dozens of hours playing it (if it's a good game you like), whereas once you watch a movie in a couple of hours you're done with it. Netflix's strength is that you're going to blast through a few movies a week and then go on to other things, whereas with a game system you'll play a game or two that month and then will play them again some other time. So there's more value with a game system to having permanent copies of the game.