I have never had the time to go back and look for then fix bad frames. I use image sequences the lot because if the render breaks, I have a very easy point to start looking for the problem.
I also use sequences a lot because it's very easy to change only 10 or 15 frames if the client needs some revisions. One other note, I did not even know this option was available so I would not miss it if it went away.
A feature that would be more useful to me would be to have the broken render not kill other items in the queue.
I have absolutely used this, and at times it's been a life-saver! The principle use case is this:
Tight deadline, late night. Delivery is tomorrow. I've got a complex composite with a number of layers (maybe 4k r3ds) and I'm going to render a dpx image sequence overnight. It's going to take several hours. Sometimes the render fails because a 3rd party plug in (say something from Re:Vision or Cycore) throws an error randomly every now and then.
If I chose Ignore Sequence Rendering Errors, maybe I'll get a bad frame or two, which I can patch in the morning. But at least 99% of the render is done. If the render crashes and it stops in the middle of the night. I'm up a creek.
Very useful feature which I don't use often, but comes in very handy when I need it.
We use it for our new network rendering software. We use it through scripting.
Like both have said, it is better to have a full sequence rendered with a frame or two bads, than having almost no frame after a not so "full after all rendering night"