The thing is that it can be bypassed: by everything that isn't a regular weapon attack. But energy types get through just fine, save-or-lose powers don't even deal damage (yes I know the death effects are few and far between, but Dominate/Hold/Sleep/Stun all result in you losing the game).
And for those that are using physical attacks, if it isn't a relevant amount, it's worthless. It needs to extend your lifespan by at least one round per battle, because it's accepted that you're going to heal up between fights (a wand/trap of CLW is spare change) and are not going to receive sufficient healing in battle (anything less than "he's nearly dead after fighting a few rounds. Heal up to full HP!" is a waste of a turn). Therefore, if you're not surviving at least one more round out of it, the DR was actually as useful as an accordion except you can't use it for Bardic music.
And most of my DMs prior to coming here did lack creativity, but I certainly don't - I pulled up some critters that are automatically CR 20 (and the dragon is listed as less than that, but that's an example of WotC blatantly under-rating a monster to artificially make it more challenging, and thus more memorable). But the Marilith has HD added to make it CR 20, the centipedes have templates and loads of extra HD...
And if you want class levels, consider this: At level 20, a rogue who, for whatever reason, is throwing darts instead of acid flasks (ranged touch attacks) will unleash up to 10 attacks per round. Heck, make them Brilliant darts (and we're still being kind and not just using DR-ignoring acid flasks) and they are basically an automatic hit. Each of those darts does tiny damage, plus anywhere from 10d6 to 12d6+20 sneak attack damage.
Best-case scenario? 7 attacks, only 4 hit, and it's only +10d6 sneak attack each. Ignoring the actual darts, around 140 sneak attack damage is dealt, minus 5*4 (20) = 120. The DM knows how to optimise? 10 attacks each hit for 12d6+20 sneak attack, or a total of ~620-(5*10=50) ~570.
The fighter explodes into a fine red mist. Granted, in this instance, no amount of sensible DR will actually save him, as DR 20 is still letting 420 points through, but even the best-case scenario is cutting the fighter's HP in half (if he's lucky).
Now, if a caster does something, DR doesn't even come into play.
Essentially, so few things are actually affected by it that the DR needs to be impressive enough to make weak attacks (see: all minion-things, armies of significantly lower-levelled enemies) do ~0, and to let him survive a few extra rounds by level-appropriate foes who choose to deal physical damage. It basically acts as a way of shutting that option down for enemies. They go "Oh, that's a fighter. No good trying to use swords, let's make do with our weak magic/throwing acid."