DNS is only used to resolve domain names to IP addresses so there is certainly the risk that the domain can be hijacked if your DNS provider turns out to be untrustworthy.
I think the question you really want to ask is what a person can do by hijacking a domain name (i.e. control the DNS records). The problems or risks that can arise are very similar to that of DNS poisoning/spoofing. Here are few examples of things that can go wrong.
- Get SSL certificates issued for your domain. This could lead to a MITM attack on any secured websites you host on that domain.
- MITM any unsecured website you host on that domain.
- Redirect your domain to their own server to host spam. This can damage your search engine rankings.
- Redirect (and hence read) email sent to the domain.
- Redirect SSH connections to a server under their control (this can lead to a MITM attack if you don't verify the server host key).
Of course, this is a non-exhaustive list but notice that none of these allow the registrar to directly eavesdrop on any communication between you and the server. Rather it allows them to redirect the hostnames to servers under their control and you won't know unless you inspected the resolved IP addresses carefully.