Kat -- all of what you say is true.

I'd probably leap at P.O.D with open arms (and may embrace it with just as much joy once I make the final decision to go that route), but, probably because I had the traditional education of an English Major, I can still see the value of submitting your work to an impartial agent and/or editor.

That, of course, is the public reason traditional publishers give for not even looking at a writer who's self-published: there's no "quality control" in P.O.D., and the assumption they're working with is that the writer who's done that wouldn't stand up to a stranger's scrutiny, in terms of quality, or that she would not be willing to compromise or collaborate with a team.

But it could also be that they're just trying to hold back the tide that's threatening their industry and livelihood. And we all know how futile trying to hold back the tide can be ;-)