It's a digital interface with optional (HDCP) provisions for encryption.
The schmucks in Hollywood have decided that HD toys that play their movies must respect "constrained output" flags which will disallow unencrypted/analog output at resolutions beyond 960x540p - 1/4 the pixels available in a 1080i film transfer.
If you don't have an HDCP DVI interface and the content providers do what they've said they'll do, without DVI you won't be able to watch pre-recorded HD movies in HD.
If you spent $1K on a set without HDCP DVI and this becomes an issue, you might not mind replacing it with something bigger and better when it happens. OTOH, if you spend $10K on a projector you'll be a bit more perturbed.