Welcome to DOG!
Concerning your dilemma, here are a few answers.
DC970K-2 is the same drill as the DC759KA. I've only recently seen the DC970K-2 model # surface this year. Not sure why it was thrown into the mix? There could be a different NiCd battery in there? I saw the DC970K-2 at Home Depot earlier this week for only $119.00!
DC759KA, I believe was the first model Dewalt launched in the compact line? Not 100% sure. It was the previous model to the DC720KA. Been around for a while, and has proved itself to be a reliable drill. Dewalt keeps it around for special buys, and promo's.
DC720KA, is Dewalt's most current compact 18v drill. You are correct about the updated grip, however it now has a frame-less motor, rather than a canned style on the DC759/DC970. This creates two benefits. A lighter weight and more compact drill, and a more efficient running motor. The motor can actually breathe better and run cooler without a aluminum can wrapped around it keeping in heat.
I personally love the DC720KA, it is a compact power house! I've done several reviews on it, you can start
here if you'd like to read up on it. You mentioned not wanting to pay for lithium. Any one of the drills mentioned above will accept Dewalt's lithium ion batteries. If you decided to go lithium down the road, all you would need are a new charger and batteries. Also worth mentioning is the DCD760KL. It is the exact same drill as the DC720KA, it just comes with the lithium batteries, and updated charger.
Hope that helps answer your questions.