They'll say this all day long, but if they had the option to BS while their friends were playing something else, they'd jump all over it.
The other thing is a lot of times you can sit there at the dasboard with your friends and discuss/decide what game you want to play.
Then it's also great for joining games. When someone on PS3 logs in you have to back out invite them then wait and see if they are even going to be playing the same game as you or wait for them to type out a message saying "invite me". On Xbox they can just join your party if they want in.
Also when playing if someone gets dropped for some reason it's frustrating as frick to have to send a message saying they got dropped and by that time the match may have already started. On Xbox with the party chat you just say "hey dickhead/IXISweat back out and pick me back up because I got kicked"
Just a PIA that party chat alleviates.