Being at university right now, it's great for keeping in touch with friends, finding old friends from yonks ago and sharing photos, organising events etc. MySpace is horrible by comparison, it just spam. Plus nearly all my friends use Facebook, so it's one destination, and easy to contact anyone I know - without worrying (as someone said above) whether their phone number is current, or they still live in the same city etc.
Applications on Facebook do have the potential to ruin it, but I like the way they've made everything take a Facebook-like appearance, the thing that turned me off MySpace was all the flashing boxes everywhere...but they're a great way of implementing features which you wish had already been put in (like Last.FM integration).
I still talk to everyone on IM, but if you want to leave someone a non-urgent message that you're certain they will get, then Facebook is so much preferred.
I can't say that I've ever met anyone on Facebook itself - I don't think it's for that really.
I do agree with the privacy point though - we are all putting a lot of personal information up about ourselves, and although Facebook lets you limit who can access it, once you accidentally grant the wrong person access to it...addresses, phone numbers, email address, relationship status, hobbies, too much potential for wrongdoing.
+ It's a great source of procrastination!