I highly doubt it will be download only. Whether or not it will have a download option, I'm not sure, but I doubt it personally for the first bit of it's life.
If they do not release a packaged version, it will actually hurt their sales for many different reasons. The first reason is, a lot of people will simply buy games when they go to the store, and see one pretty that catches their eye, think of it as the most basic form of advertising. Another thing is, people will get the idea (even though it's not the case, especially in this technological era) that it is a "cheapy" type game, something that isn't of high quality, and could also hurt their sales. Now, people like 99% of the people on this site, know better, but you have to realize we will only make up a very small portion of the total number of people buying and playing this game, so you have to see things from a business point of view.
Long Live Vana Diel.