Whereas my library of virtual assets will probably evaporate into ether before I'm even retired.
I would love that you be right. And by far, I strongly prefer physical media.
However, physical media is no guarantee either.
- Sometimes, the pain is on purpose: some apps require an online activation, and the corresponding service, 30 years later, is not available anymore.
- Sometimes, it's a lack of foresight from the developers (i.e overzealous Windows version checks, refusing newer versions).
- Sometimes, it's plain dumb stupidity (the installer is a 16-bit windows executable).
If you're not convinced, I suggest you try installing, say, Wipeout XL (for Windows 95) on a recent laptop (spoiler: at this point it's easier to play the PSX version on an emulator).
How hard is it to set up windows 95 in a vm, basically an emulator?
Physical media + online DRM is as bad as online-only.
If it uses GPU rendering, possessing physical media doesn't mean much. GPU vendors aren't that diligent about making sure old games run properly on their current hardware offerings.
Even for physical media for console games, patches DLC are delivered through the console's online service. Once that ends, as it has for the PSP and original Xbox, you're left with the game as it was originally released with whatever bugs it contains.
That’s why I prefer gog over steam, downloading complete offline installers, and keeping them backed up. This way is even more reliable than buying games on physical media. Due to anti-piracy measures, often you can’t easily back up CDs or DVDs.
The compatibility situation has improved a lot, thanks to Vista. Windows Vista required D3D9-capable GPU, actually used it to render desktop, and Microsoft’s GUI stack uses the hardware too, e.g. modern WPF is still based on DX9 because compatibility reasons.
While GPU vendors indeed don’t care about gamers running 10 years old games, they can’t ignore business customers running 10 years old LoB software. As a side effect, even very slow (by modern standards) integrated Intel GPUs are usually quite good at running older DX9-based games.
Sometimes bits rot, and the media becomes unreadable. Sometimes you're able to back it up, sometimes not.
Sometimes hardware and software incompatibilities appear. I built a late 90s/2000 era PC for that period of PC gaming (Windows 98, CRT). Other times, you get lucky and it's fixed: Freelancer won't run on Vista, but will on 7.