I think it might be included as a hard reset button for restoring the device like the iPhone can be used to put it into DFU mode. Although they might have been able to do so with a force touch + digital crown, perhaps the force touch isn't reliable enough when the phone is having problems to use for that purpose?
Otherwise it does seem like a frivolous button. With the iPhone Apple was praised (well eventually, at first many people thought it was dumb) for reducing it down to just a few buttons. On the Watch it seems like they could have just left it off. I think Gruber said something about how having that extra button really shows how important Apple thinks this device will be for communication. Guess we'll have to wait and see. I don't have mine yet so I can't really comment on how useful it is, but I do see myself using "Hey Siri" a lot when I raise my wrist.
As for alternate uses, it would be neat to use it to switch between different modes. Like work mode and home mode. At work I'd want a utility face and to get more alerts. At home and on weekends. I want a simple face with fewer alerts. Although ideally this would just be done based on geofencing and/or time of day. Or use it to bring up a frequently used app. Although glances supposedly work pretty well for that.
I wonder if someday they will allow triple clicking it or the digital crown to do certain things. Probably not unless it's already used for accessibility.