I like Inkscape. It's come in useful many times. Many other times it's screwed me over.
Perhaps most obvious is the graphics right on this site. The background is old, and a couple of the topic images were made in Paint, but most of the newer graphics were done in Inkscape. It's perfect for these little, temporary jobs that don't require lots of objects and don't require more than 10-15 minutes to finish. Logos, splash graphics, little things.
I've been trying to start a comic for a while now. I don't have a tablet or reasonable hand-drawing skills, so I've been trying to use Inkscape to create decent looking character art (and not doing too well). Here's where the downs come in. First off there's tracing. Okay, sure, it's not perfect technology, but you have very little control over what counts as an "edge", and the amount of time spent cleaning up the automatic traces is more than the amount of time it'd take to trace it yourself, if you had a tablet. I don't, and I also don't have great skill with the mouse, so this just leads to bad traces overall.
Second there's the bugs. Every now and then, when editing a path, it'll decide to just take up 100% CPU for 2-3 minutes, warming half the neighborhood by about 3C at the same time. This is a limbo period, as you don't know if the program will resume normal functioning anytime soon. Often it doesn't, and it's even more frustrating to have this happen while saving, sometimes resulting in a corrupt save file.
So in conclusion, if you're going to use Inkscape for any project larger than a button, you need to do two things: save often, and use multiple save files.
Although at this point I'm just about ready to shell out a couple hundred for Illustrator.