I would not be diving if it were not for DSD that my wife and I just randomly found out about during our vacation in a tropical resort. It was right there, it was 100% free, it only took one morning splashing around in the pool, and there was no requirement to go on a boat if one did not feel comfortable with it (and neither of us did at that time). This was enough to get me hooked and sign up for OW back home in NE in dirty water that was at least 20F colder. I would not voluntarily subject myself to that level of torture otherwise. It was also good business; next vacation my wife did her OW, and I did AOW, and of course with did it with the same shop where we did our DSD.
Last week, I encouraged a friend to try DSD, just a day before his trip to Hawaii, he and his wife both did it, they went on the boat, and they loved it. I do not think there would have been any better path for them into diving.
The full course consumes too much time... taking a few days out of your hard earned vacation is not an easy decision unless you really are sure you want it, and how else would you make sure you do? Doing the OW course locally during a weekend, on the other hand, is for many of us, quite a bit of an experience, and it takes a whole new level of determination to sign up. DSD is something you can decide on in the last minute during breakfast, it takes about as much commitment as a surfing lesson, I think that's the whole point.
As far as mildly traumatizing experiences go... I think it has more to do with the person than the way the course it taught. During the same vacation when I did the DSD that hooked me on scuba, I also tried snorkeling for the first time. Until then, I had fear of water, especially water I could not stand in, even in the deeper side of the pool. My first snorkeling experience was not easy, I went through it with a pale face, eyes wide open, drinking water, and struggling to clear my mask. I looked like a sick person that needed rescue. I did not think this makes snokeling an inherently unsafe experience.
I'd think that being able to exercise your judgment, opt out of activities your feel unprepared for, and willing to put up with some level of discomfort are prerequisites for scuba diving... if someone finds that they're not ready even during DSD, all the better. It's the responsibility of a DSD instructor to recognize early on that a student is too uncomfortable to be in the open water, and prevent the situation from getting to a point where someone can get injured.