You can definitely watch Hulu in Puerto Rico. I am watching it right now on another window and I am not using any kind of proxy. However, some time ago they did have some configuration issues that made Hulu identify Puerto Rico as a foreign country, but only sometimes. I can only assume that different content delivery systems were configured differently. Fortunately, fixing the problem was just a matter of refreshing the browser a few times.
But this artificial distinction between the USA and Puerto Rico is pretty harmful to the island because while Puerto Rico is bound by the trade regulations of the USA it doesn't get to enjoy many of its businesses and services. And this puts us at a significant and needless disadvantage.
It wouldn't be a matter of needing to be a state but of wanting to be a state. Right now only about half of the population of Puerto Rico wants the island to become a state so statehood is not going to happen. But if that number were to suddenly double then Puerto Ricans should be allowed to form a state if they wanted to. The alternative would be to deny their wish at self determination just because they don't "need to" have equal rights or representation. And that would be a truly rotten course of action. And unlike Puerto Rico, D.C. at least gets to vote for its president.
It could be argued that the moral, political, social, and economical repercussions of not having political representation are far more expensive than the cost of federal taxes. Right now about 46% of Puerto Rican voters would happily make that trade.