Actually, it doesn't appear it would take much work to insert FPS. I've played very good FPS games that had less graphics than this. Quake mods like True Combat and UT mods like Infiltration come to mind. Arma 2 doesn't have much better grasses and trees than the mods I see for DCS. All you need to do is make a few areas on the maps more built up in terrain ( Anywhere from Arma sized islands to as small as Crysis maps ) and have some decent enterable buildings and objects. The rest can be left plains and grasslands. All you have to do is look at Arma 2 to see what vehicles you need. Then just add a playble infantry soldier. I would imagine that is far less difficult than making an aircraft ( and far less demanding in calculations ).
Personally, I'm just waiting on DCS to make an SDK to do it, then just talk to some of the numerous groups who would be interested in making it happen.
It's really just a matter of time. Most FPS type players want integrated infantry / vehicles / aircraft. The Electronic Battlefield Spectrum Holobyte invisioned 20 years ago. Its kind of here already, but in an unrealistic way. I would like to see their vision of a REALISTIC one. CA is a start, but it has a long way to go. I look forward to the day I can engage a human intelligence on the ground. Right now, the AI infantry just dance around playing ring around the rosie, or sit and wait to be slaughtered.
I guess, in the end, what I really want to see is a FAR more realistic VBS.