I can see it with having a lot of tanks. I just cant see it working anywhere near as good as say a hang on, or a canister, etc.
For mechanical filtration sponge filters don't work well at all. For biological filtration, they work very well. It's all about flow rate. I used to also wonder about how effective they were, but once you squeeze one out you'll realize there's a whole lot going on.
I think I am an over fitlerererer.
Same here. I have 3 Hydro Vs in a 75 gallon. They are "rated" for 125 gallons each.

The main benefit is that they are cost effective if you run a lot of tanks. Air-driven filtration typically costs much less in electricity. You're right about them being ugly though. I never use them in nice display tanks because they are impossible to hide without wasting a lot of space.