What can you do with Bitcoins but can't do with Dollars?
It's not necessarily about what you
can't do with dollars, but what you can't do easily or without risk of lost/frozen funds. Bitcoin is about removing trust and intermediaries. For example, if you want to contribute to Wikileaks, Bitcoin is superior; they can have their PayPal account frozen at the request of the US government. Same goes for the Pirate Bay or lots of other groups/sites. Bitcoin (in theory) removes centralized authorities that can freeze money transfers (but it must remain decentralized for that to be true).
At the end of the day, you can buy all the coffee (or whatever legal consumer goods) you want with dollars. Bitcoin doesn't add value there. Bitcoin is more about the payments that they say you can't make.