The advantage of a DVD camcorder is having immediate MPEG2 video clips done with hardware encoding on a very transferable DVD medium. I switched from a DV to a DVD camcorder to avoid the lengthy capturing and encoding process that DV required, all to end up with an MPEG2 file on my PC that I can get instantly with a DVD camcorder. It's completely changed (for the better) how I transfer and store my videos on my PC.

Of course, you do need an AC3-compliant MPEG2 editor (I use Womble's MPEG Video Wizard) to edit and combine the video clips, and to read VOB files off a finalized DVD and save them as MPEG2 files (if you finalize, which you don't have to do if you transfer your video clips with USB2).