Except femtocells are limited. You can't take them with you and plug them into any pub/bar you're in with no mobile signal, nor does it help in the huge office buildings that universally get no mobile reception but have (and require) 400 wireless access points to provide coverage. You especially can't take them abroad.
The O2 TuGo app is, well buggy, but doesn't require integration into the system unlike Orange's UMA which modified the phone's built-in RIL. It's not true UMA, but rather a separate app that is essentially a VOIP client. It stays connected incredibly well - and never needs a restart. I often get incoming text messages on my O2 number quicker via the app via O2's 3G data than natively via SMSC to the phone itself. Admittedly it doesn't fully integrate with the phone's call log or SMS but that's being worked on - however the benefit is it is not limited to phones. It'll work on tablets, PDAs, and even desktop and laptop computers.
As for the "shambles" of the network, works fine for me, and I'm not going into that argument again. They wouldn't have had the most customers in the UK if they were as bad as you say.
However having full access to your number, calls, and messages, nomatter whether you've left your phone at home, not got signal, the network's down, or you're abroad is a huge advantage IMO. Femtocells only fix that in one location, and still rely on you having a phone and SIM in working order.
Incidentally another advantage - when the likes of EE send you out a new SIM (which takes up to 4 working days) but disconnect your old, working SIM as soon as they've scanned the box into the mail leaving you without a working phone for several days - EE's upcoming app would actually still let you use your phone. Though that's not excusing retarded SIM swap practices.