Video rental stores were very slow to offer blu-ray in the first place due to the higher cost and limited number of titles, and by the time they finally did, it was too late, nobody was renting anymore but streaming instead. So I'm not surprised by any of those statements. As long as blu-ray costs significantly more than DVD, it will not overtake DVD, despite the higher quality. Also, the number of blu-ray titles available is a tiny fraction of the number of DVD titles available. The only way to get a complete shift to DVD is drop the price, convert EVERYTHING to blu-ray and stop selling DVDs altogether. I don't see this happening anytime soon.
I hate to bring up HD-DVD, but that was really the right path forward. Those could be hybrids, with both DVD and HD-DVD on the same disc that could play on any player. That kept production costs down and maintained backward compatibility. Win-win for everyone. But sony had to shove BD down our throats. BD is still inferior to even DVD in many ways. Player incompatibilities abound, resume rarely works, discs are slower to load, and they require a completely different manufacturing process than DVD (which means more expensive). I'm still sad HD-DVD didn't win the format war since it would have meant a smoother/quicker/cheaper transition high definition discs.