The main benefit to having a separate hotspot is that it uses its own 5GB pool of data, whereas with a hotspot, you're sharing your data with your phone and any devices you connect with it. That, and with a MiFi, you don't need to have your phone in close proximity to your other devices for it to work.
On AT&T, there is a slight limitation that they place on the hotspot, in the number of devices you can connect to it wirelessly. Even though the iPhone 4/4S can support up to 5 other devices over WiFi (and does so when on Verizon), AT&T for some reason limits you to 3. Though, you CAN hook up a laptop over a USB sync cable and share data that way, or you could pair a device using Bluetooth, and those two won't count against your 3. You do also get an added side benefit that your iPhone will charge over the USB sync cable while keeping your laptop connected to the internet.
Lastly, if you have unlimited data and want to keep it on your iPhone, then you'll want to stick to your MiFi.
I had unlimited data and a MiFi on a separate line, but even with the above caveats, I gave it up in favor of the 4GB personal hotspot plan with with my iPhone 4 (and now, my 4S). Why? I used the MiFi, but not enough that it made sense to keep paying for two separate data plans. Not to mention it's one less device to worry about losing or breaking, and since I always have my phone with me, I'm way more likely to have it for sharing my connection when I need it. it works great for tethering both my MacBook Pro, and my WiFi iPad when I'm traveling. And it saves me about $35 a month over having the separate data plans for my phone and the MiFi.
In my experience, the 4S hotspot is pretty fast, at least as fast as the MiFi was. Your battery does get used up a lot faster, but, if you tether a laptop via USB like I mentioned before, that isn't a problem.