This is so well put and so important.
OP, it kind of all boils down to how you plan to use DVC. If your primary use will be regular stays at DVC resorts, but you'd like to have the option to trade out maybe every 5 years or so, there's nothing wrong with using your points for an exchange.
If your primary interest is the exchanges, with only occasional stays at DVC resorts, you've bought the wrong timeshare.
I've been trying to think of a comparison...let's say you want to listen to your local AM radio news station. You could:
1. Buy a $10 transistor radio at Radio Shack.
2. Buy a $300 iPhone and put a radio app on it. You'll never use the iPhone for anything but listening to that radio station, and you only get the radio stations that are in the app, not all the ones you could find on the transistor radio.
Well, the iPhone idea would work, but it's not really what an iPhone is for. And it's one heck of an expensive, complicated, roundabout way to listen to AM radio.
That's kind of what buying DVC to trade out is like. It's not the primary purpose of DVC. It'll work, but it's staggeringly expensive compared to buying another timeshare, and you only have limited exchanges to choose from.