OK, I'm kind of an anomaly in this respect:
When I was on Panther, I *adored* LaunchBar. I couldn't use a different Panther machine efficiently without it. I was fine with Tiger, though, because it had spotlight (and Cmd+Enter to load the top hit).
That was fine, until I installed Tiger on my main machine and Spotlight had a crapload of files in its database. Applications never seem to be the top hit for me at all (unless I'm very, very specific).
I craved for LaunchBar, but instead gave the free QuickSilver a go. It was nice graphically, much quicker than Spotlight, and clever. But it wasn't LaunchBar.
I think I'm going to look into things (and Butler) to see if I can reproduce LaunchBar's functionality more closely with a free solution.
I use my Dock for very specific things: Stickies, Web Apps, Keynote, Web Design stuff, Programming stuff, Adobe stuff, and then informational apps like iCal and Address Book (though I could potentially use the Dashboard for that).
App Launchers are great because they are so quick, even to launch an obscure application I haven't used for about five years. Niiice.
I guess the main difference is that some people are keyboard people and some people are mouse people (which usually is determined by their proficiency with a keyboard). I know my dad couldn't use an application launcher like LaunchBar because it takes him so freaking long to find the right keys on the keyboard.