well one thing you can with wifi hotspot do is conect it to devices that dont have usb ports like ipods and other things. usb tether wont work for me for some reason
With WiFi tethering you don't have to carry your USB cable with you. That's probably the most practical use for people who don't need/want to rely on their phone as a (if not the) primary source for internet.
Anyways, I was able to set my Droid on a chair in that area, go in the house and sit at the dining room table and connect to the web. Really slick!