Virtualization is most definitively not useless, as any sysadmin managing more than a couple servers will tell you. The advantages are so many that in fact it should be the default go-to option when provisioning a server (even a single-purpose one).

Many if not most of the production servers on the web run some sort of virtualization; Xen alone powers EC2, Rackspace, Linode, Rimuhosting and many others. In my experience it only adds about 3% of CPU overhead as a disadvantage.