Netflix beats renting movies at the store hands down. The only area netflix lacks is in immediate gratification. However, with online movie viewing that gap is rapidly closing. Their online viewing selection isn't perfect, but it is getting much better. I hook my computer directly up to my big LCD television and stream the movies online. It only takes about 15 seconds to buffer and while there are artifacts in the online compression it is still clear enough for relaxed viewing (comparable to standard tv signal if you ask me).
Netflix lets you rate the movies and categories and then based on your ratings it will suggest movies you like or movies similar to those you have views, it does a really good job at this.
The Netflix mail dvd service is excellent. Pretty much every movie you would want to see is available (I have found a few obscure rarities not present in their inventory, which did not surprise me). Netflix selection will always be better than any local video store. I have never received a dvd with scratches that wouldn't play on my dvd players. There are no late fees and mail fees are included in the price.