I digitally own SimCity 3000 Unlimited from Gog. The copy lives on my NAS. The NAS could break, sure, but so can a CD.
Can I hold it? Well, sort of. The same way I can back up my physical CDs to a hard disk, I can also back up digital things I truly own to a CD/DVD/BD or other media.
As long as the thing I'm holding in my hand is all I need to be able to make use of what was given to me at the point of sale, I see no issue.
On the other hand, Valve, who I think most would agree is a company that has been on the less bad side of digital distribution for the most part, has sold "physical" copies of games that actually still required Steam to install and use. And in that case, from the layperson's perspective, it sure seems like you can hold it, and yet you don't own it.
So IMO this argument just doesn't hold up to scrutiny.
Not really an issue these days but it certainly was back in the day
You mean legal ownership, right? Because people can illegally take your physical belongings.
If you don’t keep a copy of the game yourself, and one day you can no longer access it because GoG ceases to exist, that doesn’t mean you never owned it. It just means you failed to back it up. You could also fail to backup a CD when it inevitably stops functioning.