Why is it odd? Amazon is split up into business units, and I daresay the unit running AWS isn't in competition with Netflix. Also, as noted above, Netflix will have Service level agreements with Amazon that will protect the service, and both the EU and the US are likely to slap Amazon should they use any insider access to damage the Netflix service in any way. In much the same way as the UK Government or EU would probably intervene if Virgin Media blocked access to Sky's online services.
Another thing to consider: Netflix will be paying a lot of money to use Amazon's service. This means that regardless of who offers the most popular On demand service out of Netflix and Amazon Prime Instant Video, Amazon will profit..