This is basically a variation of a lesson in renting vs. owning. If you own, you have a level of control of the product that is superior to renting the same product (where someone else has that level of control). Renting works in the moment, giving the renter the illusion of having upwards of every bit of the same benefits as an owner. However, stop paying rent and things change quickly. OR if the owner decides they want to do something else with what you are renting, they ARE the owner, so they can generally do what they want with THEIR property.
In this case, iTunes "purchases" are really rentals. And the owners have greater control over the product we rent from them. Opting to store our "purchase" in the cloud just sets ourselves up for that owner deciding to do something with their product like drop it from the store. And if they do that, the renter has little they can do about it. Thus, this suggestion of possession of a copy is very important. Possess a copy and you DO have options if a Studio makes any move like this. Trust the cloud and you're just begging for this kind of thing to happen at the whim of any Studio at any time. Recall one of the early battles over pricing in which (I think it was) Universal temporarily pulled much of their content from iTunes. Does any of us think that can't happen again... at just about any time?
In all the other threads, beware of spinning pro-cloud arguments. Doing so is trusting strangers to be caretakers of your files, photos, music, movies, data, etc. Hopefully those strangers are good, reliable, dependable caretakers that will always be there. But since you can't know that that is the case, you are gambling on any of these "the future is the cloud" arguments if you actually follow through.
Personally, I see the cloud as a convenience only but not to be a trusted store of any data and/or especially any digital anything I've purchased from iTunes or any other source. Local copy(s) is the only way to retain ownership confidence. Else, even if you are buying digital content, you are allowing middlemen strangers into the connection to that content. Why inject for-profit middlemen strangers in such as way that you have to depend on them when massive storage on a local drive is dirt cheap?
The lesson implied by this thread should be learned by all. The cloud offers convenience but one should not set themselves up with any dependency on it. If you lost all of your cloud services today, what would you lose that you could not recover by some action of your own? If it's anything important to you, work on your backup strategy to correct that deficiency. Else, it's your fault for ignoring a lesson you were probably taught as a very young child: don't trust strangers.
