Cobs are popular for a number of reasons, and they are WELL worth the price!
As others have said, they are inexpensive and can take a lot of abuse. But I think the best thing about them is the fact that they are incredible smokers. For pretty much any tobacco other than a complex latakia/oriental blend, I've found that damn near everything tastes better in a cob. They don't ghost easily, they burn very cool, and they impart a subtle sweetness to burley/VA blends. Also, they have the ability to tame a lot of harsh or biting blends (aromatics, for instance, and drugstore burleys taste much better in a cob, IMO).
Yes, cobs have a definite "old timer" image. I feel like a Hee Haw extra whenever I leave the house with one. But for puttering around the house, reading, writing, working with your hands, etc., they just can't be beat. Plus, there are many different designs and you can find some that aren't quite as rough looking (Aristocob, for instance, carries some distinctive Missouri Meers). You can also get a really nice lucite or acrylic stem that will last forever from at least one website.
Anyhow, I wouldn't knock cobs until you get a chance to try one yourself. They're excellent bargains for the price (less than $10 for most). I have cobs that I've been smoking for nearly 10 years now with no sign of burnout, which is one hell of a good value for the cash.