I don't think Netflix cares if you're watching it, as long as you pay your subscription they are happy, and if you don't watch anything it's even better!
They would pay the "royalties". It's actually residuals, and it's usually paid to the actors and senior crew (director, producers, etc), from what i understand.
Royalties are paid to, potentially, a lot of people. Most a-list actors will get royalties with every dvd sold (and increasingly views on streaming services,) and such like.