| That's not the biggest issue. Any recording of your performance is copyrighted at the moment it's created - and your band owns it unless you have signed the rights over to someone else. The venue owner has not considered this aspect of his idea.
I like the idea, and since I deal with the creation of online courses and events, my professional opinion is that no one is likely to stay home if it's available online. On the contrary, it would be good publicity and would create recordings FOR YOU that you can re-use. I think your drummer is wrong in his assessment - but that's not surprising, because you have to re-think this in a different way.
People don't come to a venue just to hear music (which will sound different at home anyway) they come for the social atmosphere. Music is an enhancement to the "product" (social setting) but unless you're ZZ Top, music is not the primary product the venue is selling.
Just don't forget the copyright aspect while you're working through it.
I didn't vote because none of the answers provided are appropriate.
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