I use it every afternoon to update research reports based on new data that are referenced by my colleagues. I publish to html and copy the generated files to an internal web server where they can be viewed in a browser. I chose html because the reports include dynamic sized tables that are often too wide to fit within a word, pdf, etc. document. Horizontal scrolling in html alleviates this issue. I also include images, which is probably the biggest reason I use publish - the automatic embedding is quite useful and I dont have to mess around with active x to figure out how to write these images and tables to specific ranges within an Excel document.
With that said, I had to write a significant amount of my own tools to create html tables from array data in MATLAB to get proper formatting in the web browser. I also ran into several issues with excessive css declarations that publish includes in newer versions of MATLAB (2012a).
In the long run, I will probably extend my tool set to automatically export figures to image files and embed them in the html documents. At that point I will be able to create the html files myself as text files and will no longer need publish. This will also allow me to compile this process and run it on a computer other than my dedicated MATLAB machine.
So publish has been useful in allowing me to create these daily reports by handling some of the formatting details so I dont need to deal with all of them myself. However, out of the box, I agree that publish does not currently contain enough formatting features to create anything other than "toy" reports. But Im grateful that it is available as it gave me a decent start.