Hi sflights,
I keep my DS even after getting the K10 and the K20. The main reason is that although I like and use P-TTL, there are some times when TTL is just better, and I like brainless flash whenever possible. When I want a very light and compact unit -- like for handheld macros -- the DS, 200T on an angled bracket with a bounce card or mini soft box, and D FA 100 macro are hard to beat. The 280T is more compact than either the 360FGZ or the 540 FGZ and the power is usually more than I need for the kind of events that I shoot -- not bad for a $20 flash. The 500FTZ and TTL works better for birds at a distance than the 540FGZ and P-TTL for me, and has strobe settings if I care to play with it. The cool thing is that I bought all three of these flash units used for considerably less than I paid for my 360 FGZ.
I also like to break out the DS to give me some perspective. It forces me to slow down and compose more carefully, and the IQ is still easily good enough to get results that please me. IMO, it's far from obsolete. A good camera remains a good camera, even if newer models surpass it with more resolution, speed, and features. I really don't NEED more than the DS can deliver, but the K bodies do make things a lot easier.
Here's a shot from last summer with the DS, Tamron SP 300/2.8 + SP 140F 1.4x TC + P F 1.7x AFA stacked. The Ks can do better, but not that much, really.
Scott