I didn't read that as saying
each store will carry 170 titles, but as 170 titles across the 1700 stores. But, who knows? And how does their Online Rental / In Store return policy work? If an online rental gets returned to a store, does that store then add it to it's rental pool, or send it back to the online distribution center?
I do know that even with Netflix carrying almost every title in BD and HD DVD, sometimes the HD title in my Q get shipped from places like Cleveland or Houston, instead of my "local" distribution center in Phoenix.
I had others post in other forms similar to FlyingJ's - that their local store had around 40 titles.
Expect an announcement any day now from Hollywood Video/Movie Gallery about how they "respect customer choice" and will be offering both formats.