You know, AVENUE Q as a film has the potential to be a cult hit! On the scale of the John Waters films and ROCKY HORROR.
Especially if they do it with puppets and humans (but not humans operating the puppets. Treat it like the muppet movies where the muppets are their own characters).
The puppet sex musical number would be something new for Hollywood. Scandalous, even. Something that's accepted on stage but would possibly be too much for film?
In any case, the thing I love most about AVENUE Q is how it deals with its themes. It's very well-written and very appealing to the younger generations. There is a lot of HEART in the show. All of this, mixed with the originality of using puppets and the genre of being a musical. BRILLIANT.
As a film, it could still work. It would have to be re-invented, but would work.
"The Spectacle has, indeed, an emotional attraction of its own, but, of all the parts, it is the least artistic, and connected least with the art of poetry. For the power of Tragedy, we may be sure, is felt even apart from representation and actors. Besides, the production of spectacular effects depends more on the art of the stage machinist than on that of the poet."
--Aristotle