What do you think the probability is of this kind of catastrophic failure happening? If you purchase your Mac with a credit card, you get automatic doubling of the original 1 year warranty so you are only getting the third year with your AppleCare. Factor in the probability of failure in the 3rd year (aren't Apples considered to be one of the more reliable makers?), the probable cost of repair and the value of you machine at that time and balance that out against the full cost of AppleCare. If you are of a nervous disposition and it brings you peace of mind then great, but don't think of it as a wise investment because the other side of the deal is making loads of money off of it and knows it isn't.
I paid for both of my Mac's cash. In this economy if I don't have the money to buy something, I don't buy it, so I don't have the CC protecting. Not everyone pays with credit cards in this time of crappy economy. Like I said I hear stories on here all the time drives going bad, logic boards go bad. Apple doesn't make the hard drives, video cards and other parts for it's computers and anything can go wrong. I love the stories where something does go wrong after 2 years and the person doesn't have Apple Care and pays 2-3 times more then Apple Care would have cost. You think Apple makes all it's parts on it's own? Mac's are man made so there will be mistakes because of it.