What was the difference between cd and dvd release of the game?

http://wiki.hard-light.net/index.php/Installing_FreeSpace_2#Installing_from_CDs.2FDVD

None that I know of, it was just the 3 (IIRC) CDs packed into a more capable DVD and probably updated to the latest patch.

Well, that depends on which DVD version you mean.

In most cases it is the 3-CD Version that is simply repacked on one DVD with the current patch. Sometimes it also contains the Sim of the Year Edition community missions.

But also there are DVD versions that have Cutscenes in higher resolutions. The same happened to FreeSpace 1, too btw.

But in both cases the real DVD version is not really worth it, because regardless of the higher resolution, the picture is not much better.
It is nowhere near the enhancement Wing Commander IV got with its DVD videos.

The difference in picture quality is more like in Wing Commander III DOS to its Kilrathi Saga release, which simply came on bigger CDs back then.

I think you should wait until mjnmixael remastered all the remaining FreeSpace 1/2 cutscenes in HD. They are much better than any release ever were.