HDD installs are often good for game performance reasons. Who sits and watches the TV while the game installs anyhow? Or who has a dozen games they're playing all at the same time?
The devs of GTA4 were upset with the 360 because they couldn't rely on a mandatory HDD for some things (I'm guessing streaming of physics/texture data) -- imagine how much slicker GTA4 would have been on the 360 if the 360 had mandatory installs?
HDDs are pretty important for some environment streaming techniques (which make games with large environments look better), streaming music, etc. Either you have to avoid it altogether and design the game around having only a DVD for streaming (hurts the game quality), or you have to deal with a required HDD install. Many crossplats have HDD installs just to quiet the drive during gameplay, and mildly reduce loading times -- if they could rely on the HDD being there for streaming terrain, buildings, etc, large environment games, like GTA4, probably would have no pop-in whatsoever, but the HDD install would be much larger.
In RE5's case, I would wager that the "required" 5GB is due to the developers deciding that users wanted their BD drive to spin less during gameplay, more than anything else.
