DRM == Digital Rights Management. Basically means copy-protection, like with iTunes you can only play your music on one machine, not your iPod, PC and Mac. Same goes for the new Napster.
As far as service packs go, well you won’t get any more for 2000 anyway, SP4 is the last, they just released version 2 of Rollup 1.
Windows Media Player 10 already has a load of DRM stuff in it - like reporting back to MS the files you play, or asking for licenses to play music over the internet, or making WMA files you create only work on your PC. Currently it asks your permission and you can turn it off, but soon it may be in your BIOS (thanks VIA!)
In fact Windows Update has a form of DRM now called Windows Genuine Advantage - meaning you have to pass a test and report your system info back to MS before downloading bug fixes. Of course you can get around it, like all other forms of copy-protection.
Microsoft will put this crap in their OS as the movie/music industry demands it (and we all know the RIAA/MPAA run America).
BTW, you can run Photoshop on Linux using WINE, like you can run DVD Decrypter and DVD Shrink too, and there’s even a Linux version of Nero, although no Recode.