The current thinking about DNG files is that they are open-source and will (hopefully) be portable into the future. The need for DNG arises because of the concern people have that the proprietary camera RAW files generated by the different digital camera manufacturers may not be readable at some point in the future, and thus, the conversion to .DNG seems to be a logical progression and some insurance for the future. With all of the .zip and ditto drives lying around being unused these days (try finding a replacement AC adapter for a ditto drive), it’s important to make sure your data is somewhat future-proofed.
.DNG has many advantages as well as limitations and you should consider them all before converting your library. One of the main advantages is that DNG’s can be used not only to store the original camera RAW file if you ever chose to extract it, but (as is most important to me) DNG can carry metadata with them. You don’t want to be in a situation where you spend weeks adding metadata only to lose all of this information if you change systems. You should always test your files before you convert from one catalog program to another to verify what metadata imports, but DNGs are seen as a way to really help keep your metadata saved. But be warned that some programs do add non-standard metadata that may not be readable by other programs. I also like that DNGs can embed a JPEG preview, making it easier to browse your library quickly (try quickly browsing your .cr2 files – can’t be done easily).
The major disadvantage of DNGs is, other than their size, is that some programs still cannot read DNGs. If you are involved in an Adobe-centric workflow than this limitation will not be a problem.
At this point with my digital library, I am not converting old JPEGs to .DNG, but as I am now only shooting in camera RAW, I am converting the RAW files to DNG on import.
So the choice is yours. I can’t imagine that Adobe and the other major vendors will stop reading .cr2 and other camera RAW formats any time soon, but thinking about the ditto drive I DO have in the garage does get me thinking (though I did store the AC adapter in the box, too).