Apple stopped updating DVD SP around 2005. There has not been any upgrades for years. DVD SP never had the ability to burn Blu-Ray discs.
That being said DVD SP does continue to work. It still works on Lion. You can continue to make DVDs with advanced menus for years to come. If you only need simple menus for DVDs or Blu-Ray discs, FCPX will create either. If you want to create a professional Blu-Ray you need a Sony Blu-Print system or a Sonic Scenarist.
DVDs are indeed in deline. Blockbuster has gone bankrupt. DVD sales are down. Netflix doubled the subscritption rates of people that want discs as well as Instant View. Apple had a meeting last week with the owners of Hulu. Vimeo announced yesterday a new delivery system for professionals. And frankly, Blu-Ray just never caught on.
In Hockey, you win by skating to where the puck is going to be, not where it is now. 😉