For a standard transfer, they scan a print of the film (or the negative) and use that.
HD transfers are down-converted from a master at HDTV resolutions. (Usually 1920x1080). The HD master is created in the same way as a standard transfer, they just scan at higher resolutions.
Digital transfers are for films who made made in the digital realm. Most animation, 2d or 3d, is made on computers these days and some movies (Attack of the Clones, Once Upon a Time in Mexico) are filmed with digital cameras. You just convert the original staight to DVD resolutions inside of printing the movie onto film and scanning it back in.
DVD always has the same resolution (720x480 NTSC, can't remember PAL), but direct-digital transfers have better quality since they don't have to go through a film step and HD masters can be down-converted to NTSC and PAL, plus you have one for HDTV showing and eventual HDDVD release, so it's just less trouble in the end.
... but there is so much that can and does happen during / after the transfer (poor compression, filtering, scaling) that they aren't necessarily better quality. Depending on the digital source, they have the potential to be better.
That's not the customary meaning of the term "digital transfer". The concept of a "transfer" involves shifting something from a film source to a video medium. Content created in the digital realm doesn't originate on film, and there's no "transfer" involved, in the traditional sense.
The term "digital transfer" generally denotes a process in which a film is scanned to a digital file, which can then be manipulated in various ways before being exported to either an analog medium (laserdisc, VHS) or a digital one (DVD). There was a time (mostly pre-DVD) when the term "digital transfer" was meaningful because such transfers weren't the norm. In the early days of home video, films were scanned to analog video (usually professional-quality videotape), which left the process vulnerable to all sorts of analog interference. The introduction of digital transfers in the 90s resulted in a significant improvement in the quality of home video products. The immediate beneficiaries were those with laserdisc players.