People like the rights associated with files-on-disc, not the physical material they'e printed on. Digital downloads are typically rife with DRM hassle, and you often have to jump through all kinds of hoops to install on another machine, whether it's one of yours, or one of your friends'. Discs, historically, have not had that issue. You've always been able to take your disc to your friend's house, install it there (without re-downloading or applying for new licenses) and start playing.

Obviously, this is the superior experience. However, this isn't to say that getting your bits on plastic (rather than by wire) is superior. Clicking a button anytime, anywhere, and immediately getting the game is vastly preferable to ordering online and waiting for shipping, or driving to a store. I understand that it takes a while to fully download a game on a standard US broadband connection, and that it's faster to go to a store to get the game (if the store is open), but that's just a technological hurdle. The faster broadband connections (Uverse, FiOS, etc) would download most games faster than you could get to the store, and connections will get faster in the future.

ANYway, I agree that, for the moment, discs are better in most cases. The rights management is typically easier (though it's growing more complicated with online machine registration), portability is easier for the non-techie, acquisition is often faster, etc. This will all change, though. All of these problems are solvable with forseeable technology, whereas the problem of instant access to something physical is not.

Discs are better, but not because they're discs. Net accessibility will reign in the near future.