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Looks like YouTube is finally gearing up its long time waited rented movies though it has not started it but with collection of 400 movies on its http://www.youtube.com/movies/ seems to be taking a direction. Now you can watch these movies which on an average are one hour plus except the Bollywood Movies which are like 2 to 3 hours, absolutely free.
There are a couple of categories like Horror, Bollywood, Action, Adventure etc but lot of movies cover picture are showcasing half-naked girls and I am not sure how YouTube might be handling it except the age restriction policy they have.
You can hover over each of the movie to find ratings and description of the movie and you might have to signup for age verification for explicit contests which can be in terms of horror or half nudity.