There are always "excellent reasons."
It is true, the question is whether to prosecute an appeal rather than whether to mount an initial defense. It is always a matter of judgment whether to invest resources into an appeal. It is also a question as to whether it is better to take a hit on a lousy district court opinion than risk a bad precedent in appeals court. So yes, the President and DoJ have technically done their duty to defend the laws of the United States in district court and then decline to prosecute the appeal, which they have discretion to do.
But let us assume we had a different situation. Let us suppose that we had only the Florida district court opinion declaring the healthcare reform act unconstitutional, and a Republican President announced the Administration would not appeal, because he -- as the President -- personally felt the Florida judge had gotten it right.
I would be unhappy with such a result. Accordingly, while I am not happy with DOMA, I am unhappy with the decision not to defend it.