In Vegas there have been three attempts at PC game rentals that I recall. All three had limited selections, probably due to limited cooperation from publishers, and all three lasted less than a year.
As for bugs in a console game - that's rough. I mean, really, it's not like you have to worry about more than 1 hardware set. How tough can that honestly be? Especially when the engine was already fairly stable on the platform. PC releases I can see having bugs because of the wide variety of hardware and occasionally bizarre and unforseen conflicts (had the Ultima 7: Serpent Isle Sound Blaster Pro bug - look it up, it's weird). Console development, especially from an already stable codebase, should be fairly straightforward. Sounds like a simple lack of QA time to me - perhaps LA should have pushed it back a little, and maybe they could have easily met an April simultaneous release.
Unfortunately, marketing bozos and greedy shareholders looking for their first quarter dividends tend to spoil the pot. All hail Corporate America! Guess it's time for the old privately owned shops to step up and show 'em how it's really done.... Like Bioware, for instance....
Rich