The patent office is doing a horrible job at determining which patents to grant.Absolutely. I've seen lots of good software patents -- patents which are inventive, useful, and benefit the world by being published. The patent which covers rsync is a perfect example -- anything which is worth half of a PhD thesis when it is rediscovered a few years later certainly qualifies as "novel" in my opinion.
I've also seen a lot of very bad patents -- patents which cover "inventions" which were already well known in the field, patents which take a well-understood practice and add a formulaic "over the internet", patents which are written in such a manner as to not actually disclose anything about the invention being patented, et cetera.
The patent system needs to be reformed so as to stop granting so many bad patents; but I absolutely believe that software patents could be a net positive if they were implemented properly.