Thanks everyone for your great insights on my question regarding a Netflix subscription for my school library. I did a lot of follow up based on your comments. In a nutshell, my findings showed that a school subscription is most likely a form of copyright infringement. However, I am not the only librarian who has dreamed up this idea. In fact, I read of two libraries who implemented the idea. Both were public libraries. One was in Rhode Island another in New York.
I even read a Newsweek article that explained how a small town video rental shop used Netflix to broaden the offerings within their collection. Netflix was clearly not in favor of this practice, but conceded they have very few ways of policing this sort of activity.
Darn! It was just too good to be true.
McGinn, D. (2008, March 10). Sure we've got that. Newsweek. Retrieved October 12, 2008, from http://www.newsweek.com/id/117881.