stevec
For me a big factor in all of this is how the guitar feels and sounds while being recorded, and that typically happens through monitors. The less the amp sim + chain helps you to play the part the way you want, the less the performance. Regardless of what it sounds on playback after all is said and done. At least that's always been my take on it. 
Ditto.
Furthermore, amp sims only offer a representation of the real thing. Depending on the case, it can work wonderfully. Or not at all. Smoke and mirror don't always work.
A typical scenario where it practically never works for me is when the arrangement is absolutely sparse and the guitar is the center of attention. Say a slow blues, à la Led Zeppelin, with a smooth, mildly overdriven tone and nothing but that guitar in the spotlight.
Typically, that's where amp sims fail me, because they just aren't pushing the sound the way a cranked up amp tube does. Something's missing, and it's not a matter of frequencies or distortion type - those can be mimic'ed satisfyingly. It's a matter of behaviour, of gain, of intensity, of density.
In other contexts, they do work, perfectly. All of them.
I just finished a song using the Engl model on the POD HD, creating this amazing wall of guitars. Beautiful...