I went to see a Clash tribute concert this weekend, where several different bands played a few songs each. It was more fun than I expected. I guess covers are an easier way to appeal to the audience than writing your own, but I couldn't deny the energy of the bands. It took a little longer for the audience to get into it, since there's always that "who the hell are you" feel, but people were swaying and making noise more and more as the night went on.
Folk music is all about playing songs that everyone knows, even when no one knows who wrote them.. Likewise, I think it's a good thing for bands to play covers of popular songs now and then, just because it's easier for the audience to get into. Artistic value aside, it was fun. And isn't that what concerts are about? :)