Ive always said it and i still stand by it, going with DVD will eventually bite Microsoft in the ass.
Not going with DVD would've bitten them in the ass from day 0. So - as it's been discussed to death, really - they've made the better choice; they were the first to the market and they still have a substantial lead over the PS3 because of that.
And as time goes on, the size of MS's ass will continue to grow and thus that eventual bite will hurt less and less...