It's less necessary then it used to be but it's still handy if you:
-Go off-road
-Travel in areas with bad map-support
-Travel in areas with no map-support
-Ytavel a route which is not on the map
-Get waypoints from other sources

I would say that if you only go places which are supported by routable maps you don't need the navigation-functions. (That's why my Nokia fits when driving my car)

You still do that when you ride after an off-road route. (If there is a map for that area)

If you have a good topographic map there are no use in projecting waypoints, but features like off-road routes are still nice. I would say that a good navigation system, and the skill to use it, increases your safety a lot in rural places, it even makes it possible to stretch your limits a bit further.


As I said earlier all of this are software-issues and might be solved.
I briefly checked some of the links seouljoe posted, but most of the apps didn't fit my phone and there was hard/impossible to find any documentation concerning what the different apps can offer (beside fancy displays).
I can't see myself start to buy apps to find something that fits my need, unless I know that the products have the functions I want I will not be a customer.

Sorry for a late reply, the next will be even later because I'm going to a place where Nokia maps sucks and the price of an excellent map for garmin costs 300€....