My girlfriend loves it for the Your Shape Fitness game. If she can't make it to the gym, she'll pop that in and work out for a couple of hours.
As for myself, I hate exercise and when I'm playing a game I'd rather lay around with a controller in hand. Having said that, it looks like more mature-rated games will be coming to the Kinect before the end of the year; it's pretty much geared towards kids at the moment.