I wouldn't say Rex is what VA used to be, Rex bus class meals are definitely below VA, in economy they offer more (included in the fare) but Rex lounges are dire & very few, at this stage (almost like sitting in a garage in Melbourne).
I know all of this could/will change in the future and I get where you are coming from (absolutely), but it depends on your FF status, seat and what you value the most.
I am also more than happy to pay a few bucks for a drink and food if in economy, and there are also some benefits of this, such as getting through service, much faster, jump on a full-service airline such as Qantas, and you'll soon see how long it takes the crew to get through pax (nothing wrong with that, just a point).
For me, I would personally put VA above Rex, despite Rex being a "full service" airline, but each to their own and it's certainly an interesting topic
All of the above is obviously in reference to domestic only.
Internationally, yes, VAi could do MUCH better, I don't think it can stay the same as it is now for much longer, even under a hybrid model.