Providing DRM-free downloads would probably kill the studio's long-tail revenue streams. Once people have a copy of the content in a format that's going to be indefinitely forward-portable, they will never buy another copy again.

Not even for "higher" quality versions. I have an AVI of my LotR movies ripped from DVDs from whenever people bought DVDs and ripped AVIs. The quality is still very good, even played on a 4K TV. I've never sat thinking, "I wish I had the 4k Bluray remaster" while watching it.