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DVI can carry HDCP just fine. In fact, if you have a recent desktop display with a DVI port, there's a good chance it has HDCP. And if you're running a recent version of Windows with a recent graphics card, there's a good chance you're actually using it without realizing it.

In practice I've found that the quality from component cables is just as good as HDMI, even if it is analog.

If everything's working fine with both cables, there is no appreciable quality different between digital and analog.

I try to use DVI or mini-DVI where possible.

Hear hear, in fact I refuse to buy anything that won't accept proper computer inputs. Which reminds me - any TVs have DisplayPort yet?

DVI is easily connected to HDMI using a DVI-HDMI cable. I've had no problems doing this with a computer and an HDTV at 1080p resolution.