Applecare can be useful, if and only if, the device has a warrantee issue. If you drop it and it breaks, it's not covered under Applecare (not that you might not try to tell them that it just stopped working and perhaps get away with it as long as there is nothing obviously showing otherwise).
Applecare can be purchased as long as the original warrantee is in effect. So basically, the "best" thing to do is to wait almost a year until your current warrantee is about to expire, then purchase Applecare.
Personally, I have a hard time justifying spending the money on only 1 extra year-- especially since many credit cards will provide this level of coverage automatically simply by virtue of using them to purchase the product.
rob.