Isn't technology cheap enough these days to at least include DVD playback? Inexpensive enough that Nintendo can afford to throw it on there? Assuming it'll take full-sized discs, of course.
I won't use any movie-playback function - at least, I don't think I would, but maybe that's 'cause our household already had multiple DVD-playing devices when the current generation was starting. If the format was similar enough to HD-DVD or Blu-Ray or whatever format they're working on now and it played those types of movies, maybe it would be worth it to include.
Not including it means Nintendo loses the possible purchases of people looking for more than a gaming machine, including it means losing the money in production for a feature some people won't use. I would say to include it - not for me but for others who would use it...but that's just me wanting Nintendo to have less negative points against it.
Oh, and I recall somewhere about Satoru Iwata saying in the same day about the Broadway/Hollwood thing about making Revolution the central hub of entertainment. I can't recall whether or not he said "interactive" before the word "entertainment". But if it were to be a hub of home entertainment, one should think it should be able to play movies.