Tanking - Paladin tanks are just as viable as any other tanks. Paladin tanks have the best multi-mob threat containment, whereas Warriors can generate the most threat and tend to have a little more health and armour. I stress "a little", as in "not enough that you should care". Besides, Warriors have no panic buttons and they can't heal themselves.
Healing - Introducing: Paladin Healing Spells! They do what other healing spells do, but for a 20th of the mana cost! Now in strawberry flavour! Take that, Priests! =P
...Okay, so Druids have the best non-GotN HoTs and Priests have the highest +heal power along with other good defensive buffs (PW:F and PW:S), and Shamans have totems that do healing for them. That doesn't mean Paladins suck at healing. Seriously, they use up the least amount of mana as healers (and as dps). Add in Blessing of Wisdom (which Holy Paladins can upgrade), Blessing of Salvation, the ability to wear plate and you've got a very, very effective healer.
DPS - You've got to understand that for the longest time, Paladins indeed sucked horribly at DPS. Thanks to 2.3 and 2.3.2, now they don't, but that negative stigma remains, especially since not every player in the game is suddenly going to try a DPS Paladin to see what it's like.
Edit: One of the best things about a Paladin's damage potential is the fact that Holy damage is unstoppable.
Paladins are a hybrid class. They can tank, heal or dps (edit: or spell-dps, via Holy Shock) with the power of Light and are easily the most mana-efficient class. And they have wicked buffs and debuffs. That's why they exist.
Edited, Jan 17th 2008 3:09pm by PsydonX
Edited, Jan 17th 2008 3:14pm by PsydonX