Get the question "should I use a DTD or a Schema" all the time. Found an interesting article on XML.com that said in a sample of over 800 XSD schemas it found that few actually use anything more than DTDs could have provided.
One thing that I've found schema's good for is when you want to have some rules enforcement for authoring but you are using the actual XML source files direct on the Web with CSS. Firefox does not complain if it finds an XML file with a doctype declaration and proceeds to render the XML document via CSS. Internet Explorer of course will not render an XML document that contains a doctype declaration.
CA