To add to Captain Solo’s thorough post: My personal memory of the time was that DVD had been around for awhile, but was considered a weird niche that had it’s own problems compared to Laserdisc, and the price of DVD players/discs, combined with those a/v problems made people wary of pushing all in on it. I distinctly remember, at the time, the DVD of Blade Runner: Director’s Cut, failing out in a head-to-head comparison with the Laserdisc version, so people early in the format’s life figured it was maybe a way to get people to pay more for lesser-quality home video product.

IIRC, it was basically The Matrix that unlocked DVD’s potential. That disc sold a LOT of players at the time, and it was only around 2000-2002 where DVD producers started really applying everything they learned from Criterion and other studio Special Edition sets. Stuff like the “Five Star” series from Fox and anamorphic encoding to make full use of the resolution available (plus gimmicks like animated menus and super-fluff “bonus features”) is what finally pushed DVD into the mainstream. That and the very low sell-through price for the tech - I remember DVD prices basically being at, or in many cases LESSER than VHS.