I'm pretty ignorant on the whole Disc vs. Digital argument, but to me the clear winner is a digital solution like the one steam has.
Are there legitimate reasons for people to not like steam?
Note: Any "You're only renting the game" argument I can understand when talking about someone like EA, but this is Valve. Any game you buy will probably be available for you to play well after you've died.
The fear of not owning something. You're only buying a license when you purchase digital goods from Steam. Steam also has the right to remove that license whenever they like. Also they fear what's going to happen to GFWL titles in a year.