DVC members can do anything they want, sorry I just could not resist.
I am sure you mean what are the limitations to booking a stay using points versus not using points.
Booking with points, you can get the dining plan but not free dining since you are not booking a Disney package that includes free dining.
Getting certain resorts, at certain times of the year requires advance planning. If you book trips less than 7 months, you are going to be limited to what you can get and where you can get it. You can not book earlier than 11 months and that is only at your home resort.
You will not get daily housekeeping unless you pay extra for it.
Unless there is a major issue with a room being taken out of inventory you will not get upgrades.
If you check in and go to your room and decide later you do not like the room, even for issues involving things that do not work, you can and will probably will be charged a moving fee.
If you wish to use points to book nonDVC Disney World resorts, you can not use your points at resorts attached to DVC ones. Such as Wilderness Lodge, BW Inn, the Contemporary.
You can not cancel 5 days before your trip, as you do at Disney resorts, without any penalty. You can cancel 31 days prior to your trip, after that if you cancel your points go into holding and must be used before your Use Year. If you have an October use year, like we do. and book summer trips, this can be a problem if you have to cancel.
If you are a no show, instead of losing one nights deposit at a Disney resort you lose all the points for the stay.
There are advantages to DVC, it allows us to get a larger accommidation but there are sacrifices too. Only you can decide if it is right for you, it is not right for everyone.
I will say that if I could afford a 2 bedroom villa without DVC, I would have never bought in, for at times it is not a good fit for us.