I tend to believe the analysts who suggested the split was intended to make the streaming-only Netflix a takeover target, possibly by Amazon. Amazon wouldn't want the DVD part of the business because all those disc mailing centers would cause them unwanted tax headaches by establishing physical presence in many states. Amazon probably told Netflix "no deal" so there was no need to go ahead with the split.
That being said, when I signed up for Netflix 8 years ago, I got the 3-at-a-time plan for $18/month. Now, the exact same service costs me $16, and I can get my streaming elsewhere.