A noteworthy side-effects is that it dramatically increases the incentive to reform the 5th amendment (or reinterpret it, which is the usual cowardly way to achieve the same result).
From a strictly technical PoV, the concept of having several copies of the wallet, all equivalent, where whichever is spent first cancels the others, is very interesting and novel. It has a funny quantum physics vibe, too.
If they really wanted the money, they might be able to offer him limited immunity against any evidence revealed while transferring the coins to their wallet. I.e they won't use his doing it as evidence in court that the Bitcoins were his or similar things. This removes the 5th amendment problem and since the goal was to confiscate his funds, not collect evidence, the government looses little.
I was looking at it from a more general viewpoint: there are more and more valuable things you can effectively protect against seizure with a password. This was not foreseen in the constitution, which thought of seizure as a physical process.
I was looking at it from a more general PoV than simply DPR's fate: the practical need for the judicial power to be able to seize stuff is threatened by the 5th. There must be many people in the system who badly want to carve password rendition out of the 5th's no-self-incrimination protections.
Coming back to DPR's case, given the political importance of the case (it's about sovereign states' ability to police Internet on their own turf), I don't think the central problem is to recover the BTC600K as actual dollars. And I don't even know whether they could easily and legally sell them off, would they get the keys. The problem is as follows: if there are copies of those wallets, if they're spent from one of those copies, feds will look like fools powerless to confiscate millions of dollars from an imprisoned and convicted guy.
The journalist said "don't worry, feds have seized the wallets, they won't be spent". That's almost comically false, but that's telling as (conservative) wishful thinking: if only this was true, then no major social/legal adjustments would be necessary to cope with the emergence of crypto-currencies.
From a strictly technical PoV, the concept of having several copies of the wallet, all equivalent, where whichever is spent first cancels the others, is very interesting and novel. It has a funny quantum physics vibe, too.