Here is what I think about the problem areas you mentioned.
1. I agree that the client wants to retain a copy of the downloaded software. The possibility to burn your CD is almost as common as writing to a floppy several years ago (IMHO), but even if it happens something in between there can be taken measures so that the legitimate client that has already paid for the product can download it again.
2. Aren't there DRM solutions today that diminish the degree of piracy? Like software activation, for example. You may get the product, but it will not run until you get an activation key, and you get it by some out-of-band means from the software publisher.
3. Bandwidth is an issue, I agree. By the way, do you know any sources where itis clearly stated, with some numbers, may be?
I also agree about choices. Certainly the software publisher must consider the clients' demand. But I think that still many software publishers stick to the old-fashioned methods when they really could switch to ESD.
I am actually doing research in P2P networks, and think about applying some of the P2P techniques to the process of software distribution. So, I am looking for kind of "most important" problem to be solved in this case.
In this respect any comments, thoughts, doubts, ideas, etc are welcome.
Regards,
Eduard