i am willing to bet if playstation now was actually called Xbox Now the people who are defending would instead be attacking it

if they would make all 4 hr rentals $.99 and come down about 25% on the rest i wouldnt have an issue at all, that or maybe a $10 a month Sub fee for one system or $15 a month sub fee for any system to use kinda like they do with music unlimited. Come to think of it a $20 a month bundle of PS+ Music unlimited and this would be tits.

Then there are those people that don't give a fuck either way because they know they don't have to use the service.

It natural for people to defend thier investments. You proably defend the sports team in your logo until you are blue in the face, for example.

And here I thought Nintendo's Virtual Console was pushing it. This would be like if Nintendo were to offer you all the games on the virtual console for the prices they have now, but instead of buying them for that price, you'd rent the ability to stream them for a few hours.

It's moderate to bad pricing for a select demographic who don't own a PS3, but have a good internet speed. For everyone else its just plain bad and better deals can be found easily elsewhere.

I mean how far along in the ps4's development process did they think it was a good idea to get rid of backward compatibility and instead introduce a streaming service which offers backwards compatibility with the added bonus of getting money out of the consumer?

Well even if they offered a monthly subscription plan, not every game on PS Now would be in it. Publishers would only put their old games in that plan.

I think your expectations from a service like this are too high. Personally, I'd just like to see prices be a few dollars lower. However, there will likely be discounts.

Renting a game for $8 - 12 is generally a better value than a $6 movie rental.

Read this thread, the "EA Access isn't a good value" thread,  and any other PS Now thread made in the last few days. Enough people have bitched about the prices that I feel comfortable saying "you guys". 

Optional rental service : highway robbery.
How dare they charge money for a service I am not forced, in any way, to use.

Some travellers are crossing the old west, and chance upon some highwaymen, the highwaymen stop the carriage and say "ya'll gonna have to pay the toll to come through here".
"But we don't want to pay!"
"Well gee it's simple just mozey on over there to the other side of that tree and be on yer way"

Yeah, totally highway robbery.

Around about the moment they chose the architecture.