I use VATS in "pressure situations" where I have multiple enemies and need precision with my shots. If I'm just wandering around I tend to not use it.
I've found the using VATS (at least with my build) is a lot stronger than not using it.
For example - Out of VATS it sometimes takes 3-5 rounds to drop your average Fiend with a decent weapon, with VATS its always 1 shot kills for me. Using VATS conserves my ammo supply by a lot, which is useful in hardcoe since I don't have the ability to carry thousands of rounds of ammunition with me

The only thing that annoys me with VATS is how hard is to target certain body parts from time to time....like Cazadors, I can NEVER seem to get VATS to target their heads...so I always have to shoot their wings off instead.