Doesn't a physical bitcoin kind of defeat the original purpose of bitcoin?
Yes, but they're fun to show to friends and family. I gave a bunch out as stocking stuffers over the holidays (best stocking gift ever!). It gets the conversation started. Two of the people I gave them to now have bitcoin wallets and mtgox accounts.
Edit: Also, it's a great way for the non-technically savvy to store a few bitcoins. I have a relative that asked me to buy her some. Her plan was to just toss them into a box with a few gold coins.
Yea, sounds like a great marketing tool for a startup.
Best stocking gift ever is an understatement. Can you imagine your relative stashing that bitcoin for a few years only to realize they're thousands of dollars wealthier.