Looks like another digital vs film debate that is recycling many of the arguments being circulated on several forums, analog and digital around the Net. Some good arguments have been stated (and restated), and some of the stuff (numbers, perception of quality, etc) remains fodder for endless debate.
I personally come into this debate from the opposite direction. I have been shooting digital for five years (was easier after an eye operation to use the LCD screens than a small viewfinder) and eased back into film in the last two years with a Contax G2. Since then, I have gotten into the manual focus C/Y line and recently picked up a 645 at a great price from someone going digital. So I'm a big believer in film and the Zeiss line of lenses...the biggest reason I'm not totally invested in digital yet is the quality of black and white and my perception that Canon and Nikon lenses don't yet match what Zeiss offers beyond pure sharpness.
With that said, digital offers substantial benefits as a learning tool and the improvement in quality is unmistakeable, even with the upfront investment being quite high. I owe a very great deal of my improvement as a photographer thanks to the immediate feedback provided, and the ability to control results on a computer and printer. What people forget is that many minilabs (and a number of pro labs for that matter) butcher color and B&W development --the ability for people to take more control over the process with a digital, or even use a good online photo developing service to process only the shots they want, should not be overlooked.
I expect film to remain around for quite a while, but some analog ways of working (most notably darkroom work) and some film choices will go by the wayside as digital continues to mature. I don't have a commment on the cost/benefit issues at this point...that's an individual decision than can be argued either way depending on what type of work or hobby a photographer is engaged in.
Clive's arguments comparing digital to APS represent one extreme of this endless debate, just as there are people at dpreview.com on the other extreme who declare the death of film on a regular basis. I prefer not to live in the world of either extreme and enjoy the significant benefits of both mediums (digital for color wedding, studio and still life work, 35mm for street shooting and family snapshots, medium format for fine arts B&W landscape work and some portraiture). I expect that digital will take over all the color work I do eventually, assuming Contax get their act together and take a step beyond the unfortunate missteps of the N Digital.