Roy,
All of the marketing research I've come across supports your findings, as do I.
In light of that I've gone into the business of 'virtual video' that any business can afford. By using a combination of motion graphics, editing effects, professional scripting and voice-over plus supporting visuals, I can give businesses all of the benefits of on-location video without the expense.
I also make it painless on the client to create it. Usually I can pull everything I need from scouring their website and asking a couple of key questions to make it happen.
You'd be surprised at what you can get for under $1,000. Here's a sample of one I did for Flimp: http://viewit.ws?r=36979E2D-EE0D-6594-D107-6FEF83A6EC7E



