While I agree that this trend is being exploited, and I would like to see far less releases, per month, I'll never want physical media to die. It's significance goes far beyond "collector's OCD".
Honestly, I look at it all as choices & options, more so than being exploited. I completely agree I could do with far less options each month, but it gives the market more possible games to play and enjoy. My son games way more than me now, and I think even when I was his age, I didn't game as much, mostly do to the options of the time, funds, etc. Some games we like together, while he plays games I can't stand, and I play games he can't stand. How would it be if only his games got produced? Or just mine?
Growing up there where systems and games I couldn't afford, but 20 years later, I was glad those games existed. As I was able to buy them now, thanks to the fact there was a physical option. Even though my son has tons of games, there are many he doesn't get, and maybe 10-20 years from now, he may decide, oh, I want that game now. Then it's a good chance the game will be lost to the ages at that point.
I also completely understand the "business" side of why LRG decided to start offering less titles. Their mindset of less is better has it's place, as I agree there is to many options, and each one is now cutting in to the other market wise. But that likes saying, why is Capcom still making games, when Sega is to. Well maybe I don't like Sega, and prefer Capcom. Or maybe they both suck, and I want option 3, 4 or 5?
At the end of the day, I thought LRG was about the "preservation" of these titles, and if that was most important, each game should have an equal chance to be produced. When I shop at the grocery store, I'm blown away by the fact there are 50 forms of chicken nuggets in the freezer section, but guess what, each brand sells to someone, otherwise it wouldn't be stocked. So yeah, maybe some games don't need a few thousand copies, maybe a few hundred would do, but at least the game would be preserved, and I think that's the best part of all the physical releases. Just because I think it may be to much, doesn't mean someone else will.
By these "limited" places offering only certain or select titles, they become the exact same thing their trying to stop, and that's physical games no longer being offered. "N" at one point in time offered every game physically, now they pick and choose what may get physical and in what regions(as do many developers now). These limited game stops are saying this title doesn't get a chance, because this title is better and has more fans, how is that any different than "N" saying Rhythm Heaven doesn't get physical in the states, because it's not selling Mario Kart numbers? Seems rather hypocritical to me.