My suggestions, based on multiple visits to Mexico:

1. Go ahead and rent the car. You won't be on another planet. Stuff basically works the way you expect it to.

2. Rent the smallest and least ostentatious car you can tolerate, regardless of your budget or preference.

3. Get the rental company insurance. The hassle of dealing with claims against your own credit card coverage, even if it theoretically includes Mexico, outweigh the cost.

4. Watch out for speed bumps. Many of them have warning signs ("Topes") but far from all. They can be killers. Think US speed bumps on steroids. Slow to a crawl, then slow down some more, and you'll only be going a bit too fast for them.

5. Enjoy your trip. The overwhelming majority of Mexicans are honest, hard-working, nice people who put up with a lot more crap than any of us would for much less benefit at the end of the day. Treat them like the human beings they are, and you'll have a great time!