If I were to rent machines here is how I would do it. I would purchase two to three brand new Sterns(probably Star Wars Premium, Jurassic Park, and a Spiderman Vault or something?) Then I would charge $250/mo. with a two month minimum.
Once the games reached several thousands of plays-(3000-6000) I would sell them on second hand market and go buy some more new ones. I think maintenance would be minimal with limited number of service calls. Only thing unclear is how to handle disputes. What do you do when the children decide to play tic tac toe scratched into the side of the cabinet? What happens when someone decides to move or try and keep the machine. Small claims court seems like a nightmare. Would almost have to charge out the machine in full before rental-but then what is the point of the rental? Lots of questions

Wow who knew? To me $350-$400 would be too high, $250 seems reasonable and still profitable?

Big question is how do you cover your ass? What do distributors/operators do besides a contract? What kind of deposit? How do you secure your interest and how do you put a valuation on certain damages, etc. So many scammers nowadays-you basically would have to deal with only people you trust? Or charge up front in full and refund after rental?

What kind of contract? How do you protect for damage/disputes? What clause can cover varying cost/damages?

Is there a demand-how much? I would buy some Pros to rent out if some local people were interested in renting out and I knew how to cover liabilities, etc.?