@VideoTerry You have encapsulated my sentiments and, for the most part, my strategy, dead on. I agree with your assessment of the commoditization theory as well. I will say that there are some diamonds in the rough (clients that understand, often if you underpay your going to get what you pay for) here, but the new system makes it that much harder thand before, and even then it wasn't easy.
Also, I was very fortunate this past year or so to gain a few clients with long-term and "heavy-load" vfx projects (and reasonable budgets) that kept me busy, and none-too concerned with the "shananigans" here. However, I know that (and knew) that it could come (and will/is) back to the forefront (although minimized by the strategy) once again. I hope, as you said, "clearer heads will" prevail sooner than later.
PS: Did any of you ever use Elance? What did you think of it before it becmae Odesk? (Just curious.)