Holiday travel is usually stressful because of inclement weather, delays, and crowded airports. It's far worse if you are bumped from a flight or if your baggage is lost. The law doesn't solve all the problems, but if you know the law, you can use it to minimize them. On the other hand, knowing the law's limitations can also help you to avoid grief from airline and TSA personnel.
Let's first consider flight cancellations and delays. It's sad that there are no federal regulations requiring compensation for cancelled or even severely delayed flights. Since that's the case, you might as well avoid confrontations with airline personnel about those types of travel difficulties. There is a ray of hope, though.
Some airlines have created their own Passenger Bill of Rights under which they will compensate passengers for delays. However, if you are bumped from a flight, it's another story, because the law offers protection. Bumping is a possibility even if you have a reservation. Airlines over book to protect themselves from passengers not showing after making reservations. However, if you are bumped due to over booking, DOT's Passenger Bill of Rights requires that you be compensated.
Lost and damaged baggage are huge problems with some airlines and airports. An airline will almost always be responsible for lost or damaged baggage, but there are monetary limitations to their liability expressed in the small print of the contract of carriage. If you had to pay a baggage fee, federal law also requires that the baggage fee be refunded if your baggage is permanently lost.
Let's go back to delayed flights for a moment. If a plane has boarded and taxis away from a gate but, then, has a delay of more than 3 hours on the tarmac, you must be allowed to deplane, and you must while on the plane be provided with food, water, and medical and lavatory access. I wish you safe and happy travels.