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I have read about film labs being closed because they could not meet EPA guidelines with thier chemical waste, but are there any chemical waste problems in producing Digital Formats(DVD).

In the US, the EPA is The Environment Protection Agency.

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Toxic to the environment or the culture Dan? There are only a couple film developing companies here in the states anymore and I haven't heard of any of them being shut down over EPA regulations.
Culture side, I've been to our local theater several times lately that still use 35mm. The color is always good even from a digital media and the density of the prints shown is incredible. This weekend though I went with my brother-in-law to a film in a different town that boasted digital projection and the image was half the size of our smaller theater and horrible to say the least. Blocky images, washed out color and blurry as heck. If that is the best digital has to offer than I'll take a 35mm presentation. I have an older CRT projector here at home that could do a better job with either DVD or 'gasp' VHS, Or, yes blu-ray.
I know the 'greenies' are jumping at anything they can for an agenda but 35mm has been around now for ages and is still the best presentation format. That isn't going to change. If they want to keep crying and whining then we should just bring back Nitrate film and burn theaters down with the film.

Well E6 Labs here in Atlanta is still going strong. As for damage caused by digital formats, I think the production of DVD's and Bluray's would have about the same amount of waste as any other plastic production. I've actually had a pretty good time with digital projection, never had a problem at my local theaters. Even the small independent Plaza does a good job, though during their showing of Iron Sky the picture cut out for a little bit, though that's something that can happen with film as well.

True but I bought an HD LCD projector last year to use here in house and even on a 10' screen with Blu-Ray it still can't compete with the local 35mm theater. That film grain that Kodak has right now can't even be seen on a 40' screen. And the color from the new film is wonderful. The film I watched with my brother-in-law looked like it was magnefied from an old (Gasp) Kodak LCD 150 projector. Horrible image and not worth the price of admission. Even with my home projector I can't throw the towel in for actual film.