Is owning a handgun in DC actually illegal?
Effectively, yes. You are allowed to own a handgun if it's registered--but the limit for registering your handgun was February 5, 1977. So if you bought your gun after that--or before that but didn't register it in Washington, DC--you can't own it there or bring one into or through the city (The police have stated, however, that they don't enforce that on nonresidents travelling through the city as long as the weapon is unloaded, secured, and locked in a trunk--and you don't stop on your way through the city).

That's pretty dumb, although I dare say DC would have a higher crime rate than Kennesaw whether everyone owned a gun or not simply based on population density.
But while the laws are still rather stringent in New York, Atlanta, Chicago, and many other large cities, they're far more lenient than in Washington DC--and Washington's crime rate is far higher than any of these cities as well.