Back in the early to mid 90's, when I was in undergrad and using several different unix platforms (AIX, HP-UX, SunOS, Linux, DEC-OS, dumb X-terminals, etc.), different programs on different platforms treated backspace as different things. The talk/ntalk/ytalk command on HP-UX was especially annoying. It would interpret the backspace key as a ^C and kill your talk connection to your buddy across the country using his unix account to chat with you. Imagine typing away, then hitting the backspace key to fix a typo, only to have your connection killed. Sometimes shift-backspace worked (HP-UX, ftp clients, various login prompts), sometimes DEL (usually easy to fix by setting the terminal variable and/or tset), but ^H almost always worked like it should. I believe on a dumb X-terminal on my desk that I had to use to connect to a Sun server during early graduate school, ^H was the only way I could figure out how to actually issue a backspace. So, in agreement with what other posters have said, ^H isn't really important anymore. Not like it was in days of yore, when there were MANY different ways to issue a backspace, you could never be sure which would work, and the backspace key could sometimes do unexpected things. These days, backspace and delete generally do what you'd expect them to do.
To this day, I *still* automatically use shift-backspace to fix typos during login prompts, as well as ^D to forward delete instead of the delete key :) Just don't hold down ^D at an empty unix terminal prompt, or it will auto-exit the connection. This can be especially annoying in an environment when you have multiple console windows open and you hold down ^D on a blank prompt. The first window closes, focus switches to the next window, which in turn closes due to ^D on a blank prompt, etc.. In short order, all your windows are gone, all because you started deleting at the start of the command line and it ran out of stuff to delete. I never understood why this was a "feature". I have, however, adapted and will often use ^D on a blank prompt intentionally to exit a session (it's so much faster than typing "exit") ;P
A bit further off-topic, but there was one program on one system that I used one time where neither the ENTER nor the RETURN key functioned as expected. I was forced to resort to ^M to issue newlines! Ah, the days needing to know all of the alternate ^key commands :)