Hang on a sec. The DM determines whether spells have an effect? For some open-ended spells yes, but the text of many spells specifically says what it does which the DM is typically bound to go along with. I would hope there isn't a DM who would say "No, you can't do that" arbitrarily when the wizard decides to cast Haste on the fighter, or the cleric who used Divine Power on himself if everything else allowed for it.
Perhaps it's a word issue here. I take "The DM makes the decision" to imply that the DM is the sole person to make the choices on those things and doesn't need to consult the rules or take into account player actions. You, however, seem to take it as "The DM has the final say." That, to me, implies that others such as the players and the rules did have a say, and the DM has the final say.
Which I totally agree with! It's Rule 0. Duh, of course the DM has final say. But that's in the context of the rules and the players and such. To me it looked like you were saying the DM can arbitrarily say "Nope" and I would call BS on that because if I'm playing there is an understanding that we're playing by the same rules. I wouldn't just say "no" to something. I would give a rules or similar reason why I don't like something because the players deserve to know what's going on.
I'm sorry if you don't get where I'm coming from on the difference between "The DM decides outcomes" versus "The DM has the final say" but I'm not sure how I can articulate it any other way right now, or in any way in which I think you might understand if you don't already.
The DM decides (or arbitrates is perhaps a better word) all outcomes is more or less synonymous with The DM has the final say. A good DM will most certainly use the rules as a guide (and an excellent DM will know when to ignore the rules) and a bad DM will be arbitrary. The fact that a good DM has the same level of authority as a bad DM does not prove that the good DM abuses that authority. The DM does make the decisions, regardless of whether the standard he uses to make those decisions is the right one or not. i'm not saying that DM's can't do it wrong. To the contrary they can. But in the end, the call is theirs. If they mess up too bad, chances are they won't get to run a game again.
To use a baseball analogy, an umpire calling balls and strikes has a set of rules which is meant to aid in determining whether a pitch is a ball or a strike. We expect umpires to use these rules. But in the actual course of a game, the umpires call is the sole authority, regardless of what the rules say. After the game, if the umpire was a louse he can be fired. There is, also, a general recognition that the calls of the umpire will not always be 100% in accordance with the rules and that is accepted until it gets too blatantly wrong. Now one can say that the umpires power means the pitcher has no say in the matter because the umpire can call it however he wants. In the absolute abstract this might be true, but we still have pitchers that get up there and do their best to throw good pitches because they trust the umpire (mostly) to call it right.
I've had times when I tell a player, "the spell has no effect." Normally it is because the spell they used, by the rules, had no effect. It is up to the player to figure out why using their skills, or what have you. I try to be fair in such cases and consistent. Now this could I suppose, make a player think, what's the point? But it hasn't seemed to yet. Because as a DM I have built up my players trust to a degree where they figure I will make the right call.
So yes, the DM decides the outcomes. The DM has the final say. The DM is, during the course of the game, the ultimate authority and what he says happens, happens. If he messes up too badly, you get a new DM, but the new DM is going to have, if you are playing right, the exact same authority as the old DM. Its what they do with that authority that matters.