Why?
Because AC3 is the only well compressed format supported by every DVD player!!! Not to talk about playstation 2's, dreamcasts and Xboxes.....
Using any other format than AC3, PCM, or Mpeg1 Layer 2 will certainly cause compatibility issues. And what everybody wants is just to be able to stick a CD/DVD into their set top machine and have good quality music. This even adds easy onscreen navigation and other multimedia stuff.....
I make my own mini-DVD's now containing 224 bit ac3 encoded albums, complete with menu's, cd covers and even lyrics and biografies...
Mini-DVD's still are a bit of a problem to play on any hardware, but when DVD writers and media become cheaper, I definately think this is the way to go for an easy and good music experience.
What we do need is better DVD authoring software. I used several apps and the easy ones like DVDit PE lack flexibility and support for using preencoded AC3 material into your project. The more complex ones like Scenarist are a bit too complex for easlily creating compilations of music...
Mikez