I keep thinking of it in terms of autox or rallyx events that I run: If someone comes through registration, pays, and then fails tech - I give them a refund and delete their entry.
In that case you are counting tech as being part of the registration process, and they aren't an official entrant until they complete the entire process (a completely valid point of view).
In a rally event there may be a bunch of things that happen (and are covered by the event insurance) before the first control - recce and shakedown being the big ones. You may complete registration and participate in some of these events before failing to make the first control. You may also start the first event of a dual regional and not make it to the start of the second (because you are still out in the woods somewhere - BTDT). In this case it is not possible or prudent (depending on situation and potentially insurance) to remove the entrant from the entry list. Hence the need for a DNS.
My first event ended in a DNS - we registered, paid, showed, teched.....but broke a brake line while setting the terror trip during odo-check and never left parc expose. The Headwaters organizers were incredibly gracious enough to refund our entry after we could not secure parts to repair the car.