Here is my experience:

Yes, you have to wait for about 8-10 hours at Delhi Airport depending on your flight.  But unless you can afford a private Jet from US to Nepal, it is the same for most of the route.  I took Gulf air last time and had to wait 5 hrs at Frankfurt and another 7 hours at Bahrain.  Before that I took Cathy, had to wait 5 hours at SFO and another 7 hours at Hong Kong and so on.

The Customer service was way better than many Middle East countries airport where I was treated like sh** coz of my Nepali passport. (not better than Hong Kong or Singapore though).   I can't say how Delhi airport was 2-4 ago but now most of the airport staff are very young well in there mid 20's and they were very helpful.  One guy offered me a business lounge for $75 which even included a nice Indian dinner from Ashoak hotel.  To my surprise there were even some recline chairs at the airport if you decide not to pay $$.

Yes they take your passport and disappear for 2-4 hours and that was little scary.  But it’s their rule for every transit passenger, not just Nepali.  There was a US army contractor on his way to Afgistan and they even took his passport. 

And about Jet airways flight from Delhi to KTM, Jet airways was just awesome.  They served us a nice meal (one of the best flight mean I ever had) even the flight was less than 2 hours.  They served my 2 year old boy a nice kid’s meal with a very nice goody bag.

And the best part of my flight was price.  Cost me $400 less per person than flight via Middle East or other Asian countries.  I was at my home at Kathmandu in less than 30 hours I left my home at US.

I'll fly Via Delhi anytime.