I use layer files alot. Whenever we start a new project they are great to bring into a project so that the symbology is consistant between projects. Unfortunatly, whenever we update a layer, we also have to reload the updated layer into our older map documents.
This idea has been merged with Allow "dynamic" layers which update each time the map opens.
Whenever loading a layer file into a project, it would be nice if a dialog box asked a user "Do you want to update the symbology of this layer whenever the layer file is updated?"
*note I noticed that we now have layer packages in 10x. In thery, I a layer package could be used for this situation. However, layer packages store the data itself withn the package, which would be reundant if the data was already avalible on a network server.