We *could( each publish feeds of what we liked, or re-feed them with annotations. And we could follow other individuals (ie friends, acquaintances) and they us, and we could control access to levels of feed with authentication. We could have feeds of our friends (and their URLs). As well as feeds of our own throwaway commentary on life. Yeah, you could quite easily build something like Facebook and Twitter (without comments) with RSS.

The "how is that different" is that we don't. There's both a technical networking obstacle as well as an interface. You and I likely know how to host this stuff but our grandmas don't. There's also nothing —there could be— to tie this together in an interface.

Twitter et al do this crap for us, for "free".

People already have!

I'm going to use the example of Wordpress, as I know for sure that it does offer RSS out-of-the-box, but there are alternatives.

If your grandma, say, has a wordpress blog, then RSS comes for free. If she knows what a hyperlink is (even if she doesn't know what it's called) then she can paste links to individual articles or blogs or news-sites. The reader can read whatever is recommended in their web browser and if it was (part of) an RSS feed, they can subscribe. In principle, you could even have an RSS feed reader that checks all links for whether they are associated with RSS feeds, to avoid the "web browser" step.

I don't think that a non-self-hosted wordpress blog is significantly more difficult to use than Twitter. There will probably be people who can use the latter, but not the former; however, I think that it'll be a tiny minority.

With Wordpress you could even have an RSS feed of comments and pingbacks, partially (but not globally) solving the third-party comments problem.