The Form Data Integration (FDI) doesn't actually perform a render operation - it just sticks the data into the PDF object. When the client (Acrobat or Reader) gets the PDF it will recognize that it needs to be refreshed and will take care of "re-rendering" the data into the PDF. To the user this looks the same, but there are some consequences when doing operations server side.
If you use FDI to insert your data and then go to another server side operations, like Assembler to combine two documents, then your data may not be in the final document. This is because many of the server side components expect that the PDF is fully rendered. I've seen this with Output (the printed form has no data) and some others as well.
And no, FDI does not fire any script. It also does not work with XDP documents (only PDF)
I believe that Adobe's official recomendation is that you use Forms (and not FDI) when merging data with a PDF template.
In a case that I have a license for LC Forms it's obvious to render my forms using available services .
But let's say I'm a company that considering to integrate forms solution, why should I buy a licence for LC Forms and not to use a Designer to create forms in conjunction with iText to import and export data into forms?
Am I missing something?
First, sorry when you mentioned the data integration service, I though you were referring to the Adobe Form Data Integration service that is part of the LiveCycle foundation classes. Now I realize you are asking about non-Adobe software.
Second, I'm not an Adobe Sales guy - so I won't get into the "why should I use LC over iText" discussion. If you want to do a feature compare between LiveCycle and iText - including support, training and other sundry activities - then you should talk to an Adobe Sales Rep.
To answer your question on a technical basis, you would have to consider what you are using to create your form design template. If you are using the Adobe Designer tool (comes with Acrobat, CS4 and LiveCycle) then you will be generating either XDP documents or PDFs that are based on XFA. As far as I know (and I may be wrong about this) iText does not understand the XFA.