Well, I finally broke the back...
First off, let me say that I really have avoided cases only because the phone feels so nice without one, and have never felt a case (though I've seen and felt many) which really do the feeling of the naked iPhone justice. So, at my own risk, I go case-less with the exception of a gel skin cover (aka a sticker) on the back that says "Aperture Science".
That said, it's been about 1.5 years that I've had my iPhone 4, and it's suffered countless horrible drops from many different heights, including going flying out of my hands on the first day I owned it, onto the asphalt of my school's parking lot. Now, all this time later and countless little nicks on the metal outside of the phone (none of which are sharp, but look like scratches on the metal), I finally had "that one" drop where I could hear the back hit perfectly flat on a very flat surface, which lead to its shattering demise behind a sticker which now holds it all in place and projects the illusion that it is not damaged. It's since been dropped quite a few times again.
To conclude: do you need a case? Not really, especially if you're not the most drop-prone person in the world like myself. Should you have a case? Sure, if you don't plan on upgrading your iPhone anytime soon (aka. in the next couple years). I do actually know a friend who had his iPhone's back break from inside of a case due to a similar blow like the one that got mine; a nearly perfectly flat blow, and he was able to experience that uniquely horrific sound.