There are a few resons why large downloads pre-install may be required.
1) In the past, when people everywhere had rotten internet connections, if developers needed to fix a file they would send you a small tidy executable that would inject the code into the existing local file that needed to be fixed. Now you get the whole file because it's easier for them than writing custom injection code. Multiply the file sizes by the number of files that were fixed and you can see where things get large quick.
2) Assets. In interviews with Bethesda's Pete hines, he commented that they had a heck of a time getting all of the assets for Skyrim on one disk due to the sheer amount of audio data. They wrote custom compression routines in order to facilitate that. They still released their graphics upgrade as a download, because ...
3) The new assetts were not released with the original disks and other than sending everyone who owns the game a new disk (a logistical nightmare) the only option is make it available for download.
Tack on the fact that in many cases they really want everyone playing with the same code base for troubleshooting/support reasons they require the updates. Which makes sense to me.
It is a PITA, but in the end you should end up with a better playing (and looking) game which is what every gamer wants and is to their advantage to put up with the large dowloads.
On topic : I still think Steam letting people auction their used games is a good idea. Let the gamers decide how much they will pay for a used copy and both Valve and the Devs can get a piece of the pie.
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