Wired just published an interesting article that testifies about the strength of internet-based entertainment and the power of creative freedom. The creators of the animated Homestar universe, Matt and Mike Chapman, have rejected offers from both Cartoon Network and Comedy Central. They didn't like the idea of being plugged into someone else's model, losing control of their work, and being on some kind of schedule. While "the door remains open", its clear that they don't need TV to be successful. Selling Homestar merchandise is what pays the bills and keeps them independent.
These guys are living proof that you don't need to go Hollywood to make a living doing something you love, and enjoy it in the process. The fact is, that once you sign your name away for "fame and fortune" you have no leverage and have lost final say on things you are accustomed to (like final cut). If you stay independent (like the Chapmans), you may make less money (which may also be a myth), but you'll be way more satisfied creatively.
I also like the profit model that the Homestar site sets up. There are no ads of any kind, just a store link that lets you get cool goodies featuring the animated characters. This is a great way to monetize your site without "selling out" to others trying to cash in on the audience you've worked so hard to build. You are the one that should be cashing in. Selling stuff that features shows/movies/characters you've created not only gets you some coin, but free advertising, which perpetuates traffic. I've purchased two Homestar T-shirts (one for me and one for my son), and they both have the website address on the back. Smart.
It's becoming plain to me that you don't need a large entity to be a successful filmmaker/musician/artist or whatever. You do need an audience who cares about your work, and once that is large enough, you can quit your "normal" job and do what you love full-time. The more you do yourself means you keep more of what you earn. That sounds much more appealing to me than losing creative control for some immediate short-term dollars.