I'd much rather have the hardcopy version of the games (same goes for CDs, DVDs and books as well), and that's why it took me so long to even consider buying games on Steam. But once I did, I realized Steam works for me for a number of reasons:
- I live in Italy, and getting the original English versions of the games in stores is practically impossible. It's not a language issue, I just prefer having the original versions, since I've often come across truly abysmal translations (not just in games, but also TV and movies, and not just for Italian versions, but also for German ones).
- I generally don't buy new games, I'm always at least about a year behind, i.e. I wait for prices to come down. Often those games are not available in stores anymore (also considering that the PC games sections keep getting smaller), but there is no availability issues on Steam.
- Steam sales! 'Nuff said. 
I am however a little worried about ISP issues; since here streaming and digital distribution is just starting out (no Netflix for example) I try to space my downloads out over time so as not to create any problems. I still have a bunch of games on Steam that I have yet to download...
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