Uses SecuROM.
Requires “Games for Windows Live”.
Digital distribution systems such as Steam and Direct2Drive will also use Securom. Digital vendors may impose different install limits, depending on the terms set by each vendor.
Can have the digital version on up to 5 machines at a time. Must revoke each installation yourself to get it back. Assumption is that this refers to Rockstar's limits, whereas digital vendors may impose stricter limits upon that.
Retail disc version must be in the drive, but can apparently be installed as many times as you'd like. “Other system requirements” mentions “in most countries”, which may indicate some countries may not be as lenient.
Activation via Internet. Must be done once per windows account. Change to a different windows account, and you have to re-authenticate the game.
Change 2 major components on your PC, f.ex your CPU and video card, and you will have to re-authenticate your copy of the game.
Apparently, if the game assumes you're running a pirated version of the game, various changes to the gaming experience may appear, ranging from funny situations to more serious side-effects. Presumably f.ex removing a key storyline character or the like.
More info: