Yes renting a car is more economical than hiring a quality guide, but perhaps about the same as hiring a taxi or inexpensive driver. Yes, you can conceivably visit Teotitlán del Valle and the stops along the Ocotlán route in one day .... if you know exactly where to go to get from one highway to another, and know exactly which workshops you should be visiting or want to see. A GPS probably does not help you with the relatively new traffic configurations often called vueltas inglesas, so consider that before renting. Also consider parking where you'll be staying since many hotels and inns do not offer parking. Consider the cost of insurance on top of the base rate, and tax which not all rental companies disclose online when you book. You should also consider the fact that sometimes, though infrequently, there are marches and road blockades which can delay getting into and out of the city. Local drivers know how to get around them. You probably do not. Drivers often do a bit of travel on dirt roads to get you into and out of town when there are traffic problems. At least one rental company states in the fine print that you are not allowed to travel on dirt roads. They probably all state the same thing.

Not to disuade you from renting a car, entirely, but with only three days in Oaxaca, unless you plan to return soon, in my opinion if you can afford it you're much better off hiring a good guide and having him or her plan out how best you can see all of the central valley sights which interest you, before your arrival in the city.

This article might help you, and in it there is an embedded link to an article about renting a car in Oaxaca: suite101.com/article/tour-guide-driver-taxi-… The articles are somewhat outdated, but almost all of the information still applies. Hertz is no longer in the city of Oaxaca.

Alvin Starkman - Casa Machaya Oaxaca Bed & Breakfast