Ken Levine of the Bioshock design team commented that the game might receive some horizontal content expansion via Xbox Live.
If you played the expansion for either Diablo 2 or Battle for Middle Earth 2, then you understand what horizontal expansion content is. It means that, rather than just tacking content onto the end of a game, the developer adds content within the original game so that (ideally) the original game can be replayed and feel like a somewhat new experience. Games geared toward dynamics and replayability are particularly conducive to this sort of expansion. And this sort of expansion can be an easy sale, because it represents a lot of bang for your buck (both the developer's money and the gamer's).
BfME:2's Rise of the Witch King expansion added a new faction to play with, tweaked old factions with new units, improved the AI, and drastically complicated the "War of the Ring" game-mode. Diablo 2's Lord of Destruction expansion added two new player classes (one of which represented a fundamental change to gameplay, by focusing on attack combos) in addition to the campaign expansion.
Linear narratives can disrupt replayability
Dynamics and replayability are a selling point of Bioshock as well. But I don't think expanding the content horizontally will have as much impact with that game as with the fore-mentioned games.
First off, I never bought Bioshock. I'm sure that I will eventually, but the demo I played and videos I've seen have convinced me that I'd rather buy it after this fall's bounty of great games has passed and faded a bit.
However, one thing is clear enough from the demo and videos: the player is sometimes forced to focus on the storyline. There are scripted events the player must watch and cannot interact with. The first time through the game, that might not be a problem. But it's certainly a problem the second time through.
Halo 3 (which I do own) does the same thing. After you've played through the campaign once, you can skip the cinematics; but you still have to put up with forced downtime (story-driven periods without action) and cutscenes.
Forced downtime for story immersion is annoying when you already know the story.
Bioshock's DLC will sell as well as Oblivion's, but it won't sell as well as Lord of Destruction or Rise of the Witch King. It won't because the static narrative, which the developers made so central to the game, will get in the way of replayability.