There's a fallacy here. The assumption here is that Blockbuster would have led Netflix to its current status. Blockbuster at the time was a big bloated company

There's a fallacy here. The assumption here is that Blockbuster would have led Netflix to its current status. Blockbuster at the time was a big bloated company that was mainly interested in profits from renting videos. Had they bought it they would have made sure that renting would have prevailed since that was what was bring in the money. Had they bought it. It would have disappeared and another Netflix type of company would be streaming videos using the same business model. And it would have prevailed. But there's no way to know.