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Was the initiative of the Holy See a violation of DH?

It's talking about the other statements in the declaration about the freedom to be given to non-Catholics to worship publicly, and saying they apply even where special recognition is given to Catholicism or a false religion.

Exactly. This is something out of line with constant Church teachings.

This:
It follows that he is not to be forced to act in a manner contrary to his conscience. Nor, on the other hand, is he to be restrained from acting in accordance with his conscience, especially in matters religious. The reason is that the exeise of religion, of its very nature, consists before all else in those internal, voluntary and free acts whereby man sets the course of his life directly toward God. No merely human power can either command or prohibit acts of this kind.[3] The social nature of man, however, itself requires that he should give external expression to his internal acts of religion: that he should share with others in matters religious; that he should profess his religion in community. Injury therefore is done to the human person and to the very order established by God for human life, if the free exercise of religion is denied in society, provided just public order is observed.(DH)

Completely contradicts this:

From Pope Gregory XVI Mirari Vos:
14. This shameful font of indifferentism gives rise to that absurd and erroneous proposition which claims that liberty of conscience must be maintained for everyone. It spreads ruin in sacred and civil affairs, though some repeat over and over again with the greatest impudence that some advantage accrues to religion from it. "But the death of the soul is worse than freedom of error," as Augustine was wont to say.[21] When all restraints are removed by which men are kept on the narrow path of truth, their nature, which is already inclined to evil, propels them to ruin.

From Leo XIII Immortale Dei:
25. The authority of God is passed over in silence, just as if there were no God; or as if He cared nothing for human society; or as if men, whether in their individual capacity or bound together in social relations, owed nothing to God; or as if there could be a government of which the whole origin and power and authority did not reside in God Himself. Thus, as is evident, a State becomes nothing but a multitude which is its own master and ruler. And since the people is declared to contain within itself the spring-head of all rights and of all power, it follows that the State does not consider itself bound by any kind of duty toward God. Moreover. it believes that it is not obliged to make public profession of any religion; or to inquire which of the very many religions is the only one true; or to prefer one religion to all the rest; or to show to any form of religion special favor; but, on the contrary, is bound to grant equal rights to every creed, so that public order may not be disturbed by any particular form of religious belief.

26. And it is a part of this theory that all questions that concern religion are to be referred to private judgment; that every one is to be free to follow whatever religion he prefers, or none at all if he disapprove of all. From this the following consequences logically flow: that the judgment of each one's conscience is independent of all law; that the most unrestrained opinions may be openly expressed as to the practice or omission of divine worship; and that every one has unbounded license to think whatever he chooses and to publish abroad whatever he thinks.

It is simply impossible to reasonably interpret SC's permission for the vernacular as allowing an all-vernacular Mass, for instance.

Well, didn't both Paul VI and John Paul II approve? I know Paul VI gave permission for the Divine Office to be recited in the vernacular. Now, the laity were/are not obligated to say the Divine Office, but Priests and Bishops were (are?). So if Mass is a part of their obligation, wouldn't it logically follow that Mass was given permission to be recited in the vernacular, too?

When all restraints are removed by which men are kept on the narrow path of truth, their nature, which is already inclined to evil, propels them to ruin.

Injury therefore is done to the human person and to the very order established by God for human life, if the free exercise of religion is denied in society, provided just public order is observed. ... However, government is not to act in an arbitrary fashion or in an unfair spirit of partisanship. Its action is to be controlled by juridical norms which are in conformity with the objective moral order. These norms arise out of the need for the effective safeguard of the rights of all citizens and for the peaceful settlement of conflicts of rights, also out of the need for an adequate care of genuine public peace, which comes about when men live together in good order and in true justice, and finally out of the need for a proper guardianship of public morality. These matters constitute the basic component of the common welfare: they are what is meant by public order. (DH 2, 7)

See the difference?

Moreover, it believes that it is not obliged to make public profession of any religion; or to inquire which of the very many religions is the only one true; or to prefer one religion to all the rest; or to show to any form of religion special favor; but, on the contrary, is bound to grant equal rights to every creed

Again, DH does not endorse this. It says that states have a duty towards the true religion, in accordance with "traditional Catholic doctrine", that "special civil recognition" may be "given to one religious community in the constitutional order of society" without interfering with religious freedom, and that religious freedom is to be limited by what is necessary to guard public morality, to preserve a genuine public peace (as opposed to a naturalist public peace), and to preserve the rights of citizens from things such as "any manner of action which might seem to carry a hint of coercion or of a kind of persuasion that would be dishonorable or unworthy, especially when dealing with poor or uneducated people" (think of various unsavory non-Catholic propaganda, all of which could be banned under DH - i.e., Jack Chick).

Again: or to inquire which of the very many religions is the only one true

Consider DH 13: "In human society and in the face of government the Church claims freedom for herself in her character as a spiritual authority, established by Christ the Lord, upon which there rests, by divine mandate, the duty of going out into the whole world and preaching the Gospel to every creature." Isn't that a demand that the civil authority recognize this truth about the Church?

Well, didn't both Paul VI and John Paul II approve?

The Pope is not bound by the authority of a synod, even an ecumenical one, in matters of discipline. So if Mass is a part of their obligation, wouldn't it logically follow that Mass was given permission to be recited in the vernacular, too? No, that doesn't follow logically at all. The Liturgy of the Hours is not the Mass.

You may find these interesting: Pius IX, Vatican II, and Religious Liberty, John Courtney Murray: A Reliable Interpreter of Dignitatis Humanae?.