Maybe I've just been lucky, but my Netflix history shows I've watched close to 100 DVDs, and only one of them was unplayable for me. For that one, they shipped me a replacement right away and it worked fine.
Yes. That was our experience before we moved. Customer service kept blowing us off, too. So very likely where we are now is not a priority market or something. Which is sad because serving rural america was supposedly part of the whole long-tail thing.