Your argument is definitely valid and I agree with you that the economic viability is limited in the sense that NameTerrific is not an extraordinarily competitive product in the market.
However there are many small but extremely useful features in NameTerrific that are not available elsewhere, such as DNS Snippets, Profiles and Domain Admins. They simplify the domain management for web designers/developers.
I don't want NameTerrific to be the cheapest registrar, the most professional DNS service provider or a losing department of a hosting company. The vision I see is an all-in-one platform that covers every aspect of professional domain management. You get the best uptime and easiest management automatically, and you can customize the experience the way you want.
The reason that the APIs haven't been released today is because I'm adding OAuth to it. NameTerrific is designed to completely open up the domain industry to all developers.
Unfortunately domainers are never my target audience. Many professional domainers get accreditation themselves to take advantage of cheap prices and stuff like domain cancellation. There's no point competing in such a low margin field.
But well, I believe that there will be people (hopefully a lot of them) who want something simple and straightforward and are willing to spend $2-$3 extra a year to get a professional product without doing much work.
I am glad you recognize that. I worry tremendously about companies that don't realize the economics of registrars. Very few domainers actually own registrars, the biggest guys do, but most aren't technically inclined and work with existing registrars (eg. Fabulous, Enom, Moniker). Even at $2-3 margins you're going to need tens of thousands of domains to cover costs. You want the best support, but are a 1 man operation, to hire a 24/7 team, you would need 3 people working full shifts (if that includes you), we're talking at least 50,000-70,000 domains (not even sure what costs you have, so that would be on top). That's a lot of domains. I hope the DNS is really popular and has great margins, because you're going to need them.
As far as features, you have not looked around enough apparently. Profiles and domain admins are something that have been around for MANY years. I think even your registrar, eNom, has that functionality with subaccounts and access levels. I know my registrar, Fabulous, has them. I even have DNS templates (seemingly equivalent to your snippets). I have had this stuff for the past ~5 years?