A jailbreak frees the iPhone from Apple's limitations & allows the phone's full capability to be used! the drawback is that some smarter apps (i.e: Barclay's Mobile Banking) will no longer work once JB'd, and some tweaks will use more battery life than Apple would like.
I JB because it means I can mirror my phone screen to my Pioneer stereo's touch screen, add widgets to notification centre, add notifications to the lockscreen, remove apps that Apple won't usually let me from the home screen, etc.
Music Controls Pro means the O\H can control her iPod music from her standard VW car stereo buttons instead of having to use the phone's screen,
Infinifolders removes the 12 app limit on folders and allows as many in any folder as you wish.
The list of useful tweaks is endless and addictive, to the point that you can do too much and cause problems, meaning sometimes you have to restore to standard from back up & start again from scratch.
Worth it? Some can't live without their jailbreak, but I think Apple are slowly beefing up iOS to the point that JB's will eventually become obsolete - not yet though.