I'd been using the feature in Linux for years and frankly I couldn't live without it. On my MBP it's essential to my workflow. I've tried using many different numbers of spaces but I find 4 is the right number for me.
I always have a browser up that I typically leave on #2. Space #3 is dedicated to Xcode. While space #4 is multimedia apps like Adobe Creative Suite (Photoshop, Fireworks, Dreamweaver, Premiere, After Effects, Aperture, etc....) I leave space #1 reserved for things like Finder, Terminal, iTunes, iCal, Mail, Pages, & Numbers.
I've tried further subdividing and organizing apps further, but find if I do this it just gets too cluttered. I find a wide organization works best for me and my workflow. I couldn't live without spaces myself. Jumping back and forth between Firefox, Xcode, Photoshop is such a breeze... minimizing and maximizing windows just gets tedious for me. Being able to move my cursor to a corner of the screen to switch to a new space or use a shortcut goes with the way I work... not against it.