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Wouldn't audible be perfectly positioned to take advantage of this. They have the perfect setup to integrate this into their offering.

It seems more likely that people will buy a digital copy of the book for a few bucks and then run the TTS themselves on devices they already own.

Not likely at all, people pay for convenience. They don't want to do that

Yeah hackernews users kept thinking the average consumers like to tinker like we do lol

eBooks are much more expensive then an Audible subscription though.

I wouldn't say so. Audible gives you 1 book a month for $15. Most e-books I see are around $10.