In general iTunes manages to be bad in almost all ways software can be bad. In my mind, it's one of the worst applications I've had to deal with in recent years.
Imagine a world where content providers made content available for purchase over an open protocol, and allowed anyone to build apps to buy content on top of it. With real competition on the app side of things, non-piracy apps would be more usable than Popcorn Time, and things like iTunes would die in a heart beat.
I got pissed off and just pirated it and used Beamer.app to send the video to the AppleTV, it played back flawlessly.
I'm happy to pay for a movie. I've funded several documentary projects on Kickstarter. Just give me an MP4 or MKV file so I can trust that I can play it today and 10 years from now on any device I own.
DRM doesn't work. It only punishes the actual customers.
This "on-demand" nature of iTunes is enough of a value-add to justify the increased price, at least in my eyes.
edit: after checking 10 movies in the top current movies, finally found one with extras (released by Fox). so it exists, but nowhere near "most"
Popcorn Time seems like what many people want from Netflix: a much larger library. Something more like Spotify, but for movies and television.