Whenever I pirated something in the 90's I went to this site, covers archive, where I could print out the CD cover inserts. So in effect I pirated a physical copy, minus the box it came in.
Assuming you "own" a digital copy Playstation and Xbox will be just as secure. Well, aside from issues with forward compatibility a few generations down the line which is always less of an issue on PC.
The issue with discs is that they're expensive (shops need to keep them stocked, they need to be distributed to the shops, etc.), slow and fairly low capacity so most modern games would require multiple discs. The last one would, in addition to being annoying, severely limit game design if the game needs to be playable without copying all files over to the console's SSD for some reason.
With all that said - I can understand why people would want to be able to install from discs. Yes, discs are slow but some people's internet is even slower, especially in rural areas.
I'm not anti physical media; I buy Blu Ray discs because they offer a much higher bitrate than streaming. However with three people using my PS5, the convenience of not needing to swap discs outweighs the advantage of having a physical copy that I am highly unlikely to sell or lend.
Or the consoles could have a writable drive and the game disc could have a rewritable section for recording if the license is currently checked out. You could have the systems be able to install and play from the disc, while also recording that the license is checked out to that system. Then the disc wouldn't have a playable license until you unmount the license from the system and it records back to the disc partition that the license is available again. That way you wouldn't have to mess around with the disc's after initial install, but you can transfer the license back to the disc for resale when you're done with it.
It isn't hard to imagine a system that has the best of both disc and server attributes, but clearly the console companies have motivations to keep physical media constrained and inconvenient.
Fallout New Vegas did this to me over 10 years ago. Brought the box home from GameStop only to find the waste of cardboard wanted me to download the game from steam instead.