This was a feature request in the old forums that our faculty were particularly interested in (posted originally by Glen Parker)
It would be helpful if it were possible to make a file visible by students, but for them not to be downloadable. I can see a few use cases for this feature, including a) copyrighted material and b) answers to final exams, etc.
As is often the case, David Lyons is right on the money with how we are thinking about this feature request. Building a feature to "lock down" access to files would give teachers a false sense of security regarding access to their files. For many file types, there is no way to give a student the ability to open a file on a desktop, tablet, or smartphone, without giving them the ability to download (and share that file). Any object shown on a computer can be copied with a screenshot or a picture taken on a camera phone. It is very unlikely we would ever develop this type of feature.
If there are other use cases or workflows that could be used to meet a teacher's need to protect content. Please describe them in the comments.