Unless key prediction gets *much* better than what I've seen on my phone, it seems that I'd quickly learn to ignore any hints given by the keyboard since more times than not, it would be wrong.
I shared your opinion until recently, so I was surprised to see how much better prediction has gotten with alternative keyboards on my Android device. SwiftKey is all about prediction, and it learns quite quickly. It has a decent training set right out of the box, but a week later it's night & day.
Swype isn't as sophisticated as SwiftKey with next-word prediction, but the idea of tracing in lieu of keystrokes is great. The first beta was almost unusable, but after trying beta 2, I switched and I'll probably never go back to key-tapping.
I think smarter keyboards will be a short-lived phase though; voice recognition is really coming of age the past few years, and when it works it's far more efficient than even the most accurate predictive keyboard. (Well, unless it predicts your whole next paragraph, I guess...)