Digital distribution is a welcome feature for select titles.

I purchase downloadable games on occasion, however I am very particular about what I get in this format. The biggest reason, for me, to buy a downloadable game would be for convenience sake. Having Battlefield 1943 on my Xbox 360 and accessible right from the dash is really great.  
I have always been a big game renter. I rent from Gamefly and more than 95% of my games are not purchases. The few games I do buy are either really long and full of replayability, such as Oblivion and Forza 2, or are multiplayer focused. If Modern Warfare 2 had a download option, I would jump at the opportunity. Having the convenience of accessing a game from a menu for titles I play a lot not only saves the wear on my disc drive, but also is preserved from ever being scratched or stolen as you can always recover it via download. 
If it is a game that will be in my collection forever (never going to sell it) and the DRM is smart (no download limits) then I am all for digital distribution.