But the major thing I said is that the non-BD software players such as VLC will never implement it. Media Center may never implement it if it never supports BD. So once the content is "jailbroken" from the BD using something like MakeMKV, it doesn't matter if that watermark is still there or not, it will play fine on software media players (maybe not software BD players). So who cares? Who is going to write it back to an expensive physical BD disc anyway? I hate to tell you this, but BD is a dying format even while it is still growing because the true final format is no physical disc at all and it is only a couple of years away.
That is EXACTLY correct and what I've said on other forums, as well. I plan on using MPC-HC + ffdshow to play MKV's make using MakeMKV for my backups. In that case, Cinavia isn't even on my radar. I suggest all HTPC users create a "plan b" playback setup, as well, as you have done. And I unfortunately agree with your BD assessment, as well. Once internet speeds make it feasible to stream the same quality as BD, it's game over for the format. It may die even before that with lesser quality. Netflix with 1080p + DD+ is already a reality on the PS3.