In the case of Netflix, the video content doesn't need to go through a proxy; only the website does (at the moment). So bandwidth shouldn't really be an issue.
Interesting point - although it's not really symmetrical. For example, Blackstone's formulation - "It is better that ten guilty persons escape than that one innocent suffer".
In addition, prosecutors are presumably held to a higher standard than defense lawyers, since they are state employees and are bound to act in the public interest.
That's not an argument for any block size in particular, though. Saying that fee revenue is maximized at smaller blocks is positing that demand for block space (i.e. transaction demand) is relatively inelastic, whereas there isn't really any consensus or even much discussion on what the elasticity is.
Any idea why this is the case?