What are feeds good for?

Do they have any SEO use? Or are they more just for site visitiors to get notified of updates?

Well feeds help in getting you more visitors, so it does have some seo use to it.

see this one http://forums.seochat.com/link-popularity-43/link-building-through-rss-186013.html

its nothing much rather than just giving a bit of more advantages. Its number of feed readers, shows how good a site is even though if you are not having much adorable traffic. Some blogs have very less traffic but good feed readers. Also another thing is you can monetize your feeds also. So though you are getting less revenue you are going to gain good value in future.

In addition to everything said above, you can double up back links for the content in the RSS feed (the xml page) if you also have article pages on your site.

For example, if you submit the pages that have articles on them to something like Article Troll, you can also submit the feed xml and essentially get an extra backlink. Its the same content, but there's no duplicate content penalty because you're reading the feed through an RSS reader.