Yeah really. lol
The confusion of roles arises for several reasons. For one, I get most clients through word-of-mouth, so they are friends or acquaintances. Therefore I do take a big interest in some of the groups, going to their shows and getting to understand their music outside of the studio. Between this and the time we spend in the studio, lots of ideas are discussed, and I try to make them aware of ideas for promoting themselves that they may not have tried yet.
The other reason is that I tend to work with older musicians who aren't as internet-savvy, so it either takes them a while to try new forms of technology (websites, social media) or they need help with it. I also work with several bands that have a history with one another. They're relatively new bands formed by veteran musicians from the same "scene", and most of them have either played together in bands before or just know each other. So there is plenty of room for friendly rivalry. It's 99.9% all in good fun though.
There are also other issues sometimes with band members confusing the role of a studio with the role of a record company. One of the bands that I recorded didn't want to sign with a record label, because they were "happy recording at my studio". I told her, that unless it's a bigger label that is closely involved in the studio process, they probably could still record with me. Now, after explaining that to her, the same topic came up again just recently. I did a record for another artist, and it was released on a small label. She told me that the other artist ripped me off - because on their CD packaging it said "Such-and-Such Records". She told me that the album wasn't recorded there, it was recorded at my studio.
Of course, it's just my job to record these artists and get their albums to the point of being ready to release. What they do in their business decisions is literally their own business, but when they confuse the issues, it can get tricky to explain. Especially when they're turning down labels because they don't know what labels are, and they don't want to be disloyal to my studio. It's kinda like... "by all means, at least see what the label is offering and if it benefits you. I can still record you, and the album will possibly get out to even more people if the label can distribute it and market it right".
I guess I can understand the trend in rap music for there to be "production companies" that merge the recording, label, and management duties. It's just hard to do without money to fund it all, at least in the more "acoustic" roots genres that I work in.