Something I haven't seen mentioned that you may want to also consider is a Roku and a Simple.TV. The Roku is compatible with most online services, but you are still left with rabbit ears and swaping inputs. The Simple.TV would allow you to watch OTA shows. http://gigaom.com/2012/10/15/cord-cutters-simple-tv-the-dvr-for-cord-cutters-reviewed/
Another thought, a SlingBox would allow you to watch OTA shows most places, too.
I would have done this, but I live in BFE so I don't get any OTA channels.
A personal mini-rant on this:
I tried this. It worked OK. I had cable internet and it came with "basic" cable. That and a blu-ray player with Hulu and Netflix for services and a Boxee Box for local stuff and I was set
Then I did some number crunching. After all of the service fees, I figured cable wasn't much more expensive. ($80 a month for cable and internet, internet was ~$40 alone) The down side is I wouldn't have gotten all of the shows when I wanted to watch them. WMC and a cableCARD tuner resolved this for me. I now can get all of my shows I like, record them, remove commercials, compress them, and archive them on my own drives and use them on any device I want. This seemed to be the better long-term solution for me. It may take a while, but I will eventually gather a large archive of content with no strings attached that I like. I can also take the content with me when I don't have a reliable internet connection (like, say, in a hotel).
Looking back at it, though, a regular cable tuner that works with "basic" cable would still record ~90% of what I watch. If you go with internet through your cable provider, and get free "basic" cable, you could do the same thing, also getting your the OTA stations, which "cable cutting" does not get you. I also wasn't a fan of trying to remember what shows are on what service and IF it was even available on a streaming service. So "basic" cable (if it comes with my internet) and Hulu+Netflix would probably the way I move forward if I get fed up with cable and them jacking up my bill.
So, that's my $0.02 (or more like $0.03) on the subject