I just saw an article yesterday (it was linked and I don't remember what it was called) indicating that digital distribution accounts for 42% of PC game sales. The top 5 were Steam, Direct2Drive, Blizzard, <something else I can't remember... it wasn't Impulse which surprised me>, and Battle.net
Yes, Blizzard.com and Battle.net were separate entities.
What constitutes a dominant market position?
As clearly evidenced by Steam's current library of games, a game does NOT need Steamworks in order to be on Steam. Developers opt in to use Steamworks for SOME reason. If they want to be on Steam but not use Steamworks, this option is available to game developers.
Admittedly I don't know what direct benefits there are to using Steamworks, but I'm going to go out on a limb that there is at least SOME value for game developers using Steamworks.
To reiterate: You do not need to use Steamworks to use Steam.
Yes, there are no alternatives to Steam for some games. There are no alternatives to Good Old Games either for some games, near as I can tell. Scrounging up rare copies on ebay that often don't even exist is not a viable alternative IMO either.
Ask the developers that decide to use Steamworks instead of just using Steam as a DD method. There the ones deciding that they want more than just Steam as a distribution service.