You'd want netflix for renting blu-ray discs, so yes you want netflix either way
Streaming HD is going to be low-bitrate, maybe cable quality if you're lucky. The selection is also going to be weak at first.
Blu-ray is very high bitrate 1080p, with no stalling for buffering if you have a network issue.
Also, most new movies are coming out on blu-ray now, so why not see them with the best possible picture?
Disclaimer: I was the first person at work to own a DVD player back in '97 or '98, when players were still $300. I also paid $600 for my 60GB PS3. So I'm more willing to pay for picture quality than most people.
I plan to have both once I can get a Jasper 360, the streaming will be a nice supplement to getting discs in the mail.