"if a LCD is connected via a VGA interface include the vertical retrace delay, ones connected via digital interfaces do not."
They do. A *lot* depends on having that interval available.
"having an image change halfway through an update from one frame to the next with no other distortion of the screen (and cleaned up on the next frame refresh) is a _very_ minor issue compared to loosing sync which scrambles the screen for a significant amount of time (several seconds on a LCD)"
The common case is watching videos or playing games, where it's not cleared up on the next frame refresh because another update has happened in the meantime. It manifests itself as a consistent discontinuity in the image. It's greatly irritating.