Actually it can if you use third party resources. I made a business out of it by making websites for my local businesses. I also use it to market IT stuff. iWeb is not perfect but it's also not a waste. You can make beautiful sites, fully customizable with effects and flash elements. You just need to do some outside coding to bring it up to snuff.
Some third party apps I use:
Graphics: Photoshop/Pixelmator
Icons/Buttons/graphics/Text: Art Text 2
Flash Banners/Effects: BannerZest Pro
SEO: iWeb SEO Tools
HTML Codes: Code Collector Pro (safe place to store my codes for scrolling text, shadowbox, video/audio players, etc)
FTP/Code Editor: Coda
SiteMaps/Search Engine Notification: RAGE Sitemap Automator
Reduce Site Size: WebCrusher
iWeb is easier to make a basic website, but to really use it beyond it's limitations you need to use other apps like the ones I listed above.
I hope this helps.