I had watched a video about this and found this to be a great tip. I don't consider myself a purist; however, I have gotten the critique of pieces being too centered and do concur with panning making instruments standout. I must say this though - while panning has to occur for elaborate instrumentation, there is a problem as you just can't just throw whatever to the side.
Someone asked me about panning laws and while I don't recall or fully understand the "official" definition, I did use lamen terms even though I still may be wrong.
The problem one runs into is clipping/distortion because the further you push, space within the spectrum is truncated and has to compromise something. In the case with panning, it's volume. (Mixing - which panning and its laws are associated with, isn't what I'm explaining though)
Now, it may be that you're recording at -10dB (always record/mix @ low volumes, btw even if all is centered). at center, but as some say, it doesn't stand-out. Well, it wouldn't if 5-10 other instruments are in the middle as well.
If you can't hear an instrument, panning because of the volume compensating due to limited spectrum space, helps this - not only due to reducing a congesting "center-field", but you don't have to crank the volume or lower it from the other instruments to hear it.
I think "wanting instruments to stand-out" has taken a bad connotation though this isn't wrong. I've heard it said like this: "You don't want the instruments fighting each other." This is much more applicable when talking about
frequencies within the spectrum. You also hear things like: "Muddy Mixes."
Most relate this phenomenon to bass, bass-like or low-end/bottom instruments.
Again, while this end of the spectrum is the most common, the higher ranges are also prone to this as well. This is due to too many instruments (guilty, but it's how I write). Again, though, like panning being "horizontal" while too many instruments is "vertical", you can get a pretty good mix with a hefty instrumentation (and you should be able to if you can get a bad mix with light instrumentation) You have to know what you're doing in both cases.
Anyway, in the video I watched. the guy said that you want keep the important stuff at the center and move the lesser important things to the side; however, you must keep the panning law and what happens in mind, too.
Many have probably implored this tip, too where instead of putting a track a dead center, make a duplicate of said track, and push both to the sides. It's quite obvious with vocal doubling, but the effect heard is one slightly ahead of the other. Stereo Separation. The chorus effect is exactly this in a sense.
What I am talking about though is what Philip mentioned as the illusion of center. If mixed right, one shouldn't be able to tell if something was centered or doubled + panned unless of course it's intended to be known that it was.
Going back to the pan/volume compensation issue, it'd be easiest to grasp when looking at a wave file. If the channel graphs are reaching towards the top or bottom (left/right channel) then something or things have been panned too far over. (Frequency Space isn't being discussed, but that can have alot to do with it as well)
One last thing:
It generally comes down to preference. There was a thread asking a question if one uses the same pan rules or not from song to song.
For me, personally, I do. While it is because I'm use to:
Bass, Drums, Piano, Harp, Strings centered (real or illusionary), Maracas left Cabasa right, etc. keeping in mind that I'm only listening from the left and right only (from speakers), but also from live music. Regardless of where they are placed, the sound from them is still reaching only two ears.
I've tried flipping things around, just for fun and it didn't sound bad, just weird. It's like someone learning to read backwards when since birth they've read forwards or vice-versa. Even if one has done both, one still may prefer one over the other.
Don't just pan stuff to pan it. "Centered Tracks" aren't a bad thing as you don't want everybody in one place; however, you don't want everyone all over the place either.