A few people will do this but most won't. The fact a few people game a system rarely stops a business model. It doesn't have to work in every specific instance, just overall.
Actually I think most would - perhaps not at a 10x multiple, but at least 2-3x, maybe 5x. If I were to download a brand new movie that just came out today I would definitely watch it with at least my girlfriend, but possibly invite a few friends around for a movie night. Or some friends would invite me (I hope!).
I would end up watching a lot more movies, but providing much less income to the movie industry for each.
As I said in the original post, you wouldn't charge at a single ticket rate, you'd price it based on what worked. My assumption would be that most people would watch with maybe one other person and that the price would reflect that.
As I also said they lose the ability to up sell you highly profitable popcorn, you lose travel costs, the lose some overheads (but gain others) - there are a whole bunch of things to figure in. The release day cost of a movie rental wouldn't be a single cinema ticket price and it certainly wouldn't be a current rental cost. Off the top of my head I think you'd be looking somewhere around two to three times average cinema ticket prices, possibly varying by time (weekend evenings might cost more).
The last sentence is a good thing for them though not a bad one. If you watch 3 movies a week instead of one and pay on average $5 instead of $10, they've still got $15 instead of $10. Their costs will likely only be marginally higher with three movies vs. one (most of it being the infrastructure) which means that their overall profit is likely up.
You don't optimise a business for revenue, you optimise it for profit.
