I like your two tier rental theory. Of course there are lots of variables. I actually mentioned the possibility on the Mira Mesa rent thread.

Tenants should have better rights in the case of deposits. It should be in a joint account. That way if the tenant had to take the landlord to small claims the award could be sitting in a bank and the judge could order the release to the tenant or the owner, whoever prevailed.Maybe some new laws would have to be written? I could see where leveraging the hassles of court against the deposit could come into play,probably in favor of the tenant, but as it is, the landlord has too much leverage on the money.