Ever since I brought home my DVD player, I've snubbed my VCR and become a DVD snob.
But I see it this way: We have videos of our wedding, our honeymoon, our daughter as an infant... Where am I going to watch these things? On my VCR. I'm sure at some point we'll be able to convert them to another media, but for the foreseeable future, the VCR is a cheap, widely adopted way of sharing these things.
That doesn't address the copy-protection aspect of the story, but it is a common denominator for a lot of people, I think.