I use it all the time. I've got a large DVD collection, even by the standards of this forum, but more than half of the DVDs I view in any given week are rented from Netflix.
You may not remember the days before DVDs were so easily rented with such a wide variety of titles available, but I do! I like alot of non-mainstream flicks and if I wanted to see these on DVD in the early years, even if only once and certainly without assurance that I'd want to see it again, I had no choice but to purchase it. There were simply no options, even in a larger city like Boston.
Netflix started out with some growing pains, but they've become an excellent service (for me anyway). Perhaps it's because I'm so close to a distribution center, but I have a turnaround of 2-3 days (usually 2 days!). And while they occasionally fail to stock some movies I'm interested in renting, this happens far less often than in years past.
If you watch as many movies as I do, and especially if you like to take chances on movies you may not like, then Netflix is really the perfect sort of service. And if you watch movies frequently enough so that you can keep turning them around as soon as you get them, you can drive rental prices per movie down to nothing more than pocket change.