I appreciate your polite and thoughtful response :) That being said, I don't really feel convinced that there is a difference. I think that just as open source software doesn't solve every need, the same goes with art and there will always be value for the people who can create original work and there will always be people who don't value that. Honestly, it sounds like a bullet dodged if you lost a contract to a client who thinks that way. They probably still wouldn't value you very highly and would likely be a bad client. That's my philosophy for freelance work. I feel like it's a common problem across industries. If what you do actually is more valuable than something available for free, it is no threat. Fundamentally someone will need your service if they can't actually get it for free. The people who think the free substitutes are better will probably learn that the hard way and there are others out there who will know better. And if what you do is not more valuable, then I think it's not a bad thing that you don't get paid, because you should make money for providing value. You gotta keep yourself marketable with valuable skills.
I think you might just be a bit more optimistic than I am, as I myself am not convinced that quality (by non-monetary measurements) will win (or even survive) in the end D:.
