Edit: God, You people reply fast.
Now that everyone is through listing their assumptions, yes piracy is a small reason why this decision was made.
The main reason that drove the decision was to prevent hacks/bots/dupes on Diablo 3. The aforementioned was arguably the #1 complaint about Diablo 2, and Blizzard set out, from square one, to fix that complaint. The first, and probably largest step to securing the servers from these issues was by hiding the server architecture.
Diablo is a client/server based game, like many games today, where a client interfaces with a server to receive the information that it needs for the content of the game. In order to create an offline functionality, they'd have to reproduce, 1-to-1, their server architecture in the game's install files, essentially handing over the blueprints to their security systems to all of the hackers in the world. Obviously, given this information, it would only be a matter of time before the hackers broke the securities and, once again, flooded the land of Sanctuary with duplicated items, hacked items, and spam bots/run bots/mf bots.
All that being said, I hope you and anyone else reading this can see that Online-Only is a good decision, and is not designed as some underhanded scheme to make the paying customers suffer.
Thanks for the well thought out answer!