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Damnyouall said:
Yet you failed to address the most pressing issues: You can't resell downloaded games, and once the current download/distribution service ends and your hardware breaks, you can't re-download your games.

I actually did address this.  I said it was the only real setback.  Although buying used games is never worth it.  Save $3 and get a used, smudged, scratched version! YAY!  Lets not forget that developers would be recieving much larger profits from a DD model so would likely offer games cheaper and negate the need for a used market.

For the rest, please see my other post.  It covers the timeframe issue and the fact that physical media can expire just as well, if not even sooner than DD.  DD can be permanent if a company wants.  Physical media will always expire.