It should be available optionally to install whenever you want, lets say most of us get a game and we want to jump in and play right away. When we sit down and start the game the installation plus downloading patches can take up to 40 - 50 minutes which is a total turn down.
I have a friend that was trying to play bioshock and said, I waited 45 minutes to install the game with a 6mb connection, it really blows, I finished installing and turned my ps3 off. Most people dont have 4 hours to play a game so 40 minutes is way to much. If installations are necesary developer should make them optional and whenever we feel we have time to spare install the game properly lets say a week later or a couple of days later.
Another thing thats really out of hand is the size of installations, they go up to 5 GB and most people have the 40gb ps3 so go figure. Installations are big and the bottom line is they will cost you down the road either upgrading hard drives or deleting your content that took you a lot of time to install. Sucks doesnt it?