DVI becomes worthwhile in gaming under certain situations. The higher-end Samsung Syncmaster TFT LCD monitors, for example, are perfectly capable of a 2ms gray-to-gray response time using DVI. When you use VGA, they only do something like 5ms. That doesn't seem like a lot, but in a game or movie environment, if the screen is mostly dark and black and there are some lights moving because of your changing perspective, you'll notice marked "trails" behind the lights at a 5ms or slower g2g, and nothing at 2ms w/ DVI. I know; I own a Syncmaster 206BW, and tested it using Half Life 2: Episode One and a copy of Miami Vice. There are other small image quality differences, too, but on a monitor smaller than 30", the average user won't notice them.
Whether or not to go with DVI is a personal choice. If all you want to do is surf the internet and do some word processing, VGA is a fine cost-effective option. If you're a gamer, or you're building a media center PC, DVI is well worth the additional cost. Check the specs of the monitor you plan to buy. If they don't tell you the GRAY-TO-GRAY response time, don't bother if you're in that gaming/movie market. And then check to see if they tell you response times are different. I can highly recommend the Samsung 206BW. For about $275 these days, you can get a 20" widescreen monitor that kicks the crap out of $500-$750 uber-screens. Interesting note: The 20" 206BW has the same pixel count as the 22" version. And mine shipped with one dead pixel that I only saw when I ran the pixel checker program, haven't noticed it since. The box also included a high-quality DVI cable, *and* a VGA cable.