My rule of thumb is that the end users of a web application will perceive that the system is "slow" if the 1 minute load average is above 4 on the application or database server.
Load average can tell you if the system is under-used, but it can't tell you how the system is over-used.
I regularly have a few dual core systems spike to load averages of 50+ because of suboptimal NFS mounts. The NFS issue keeps processes waiting around with nothing to do for a while. Those processes are still counted towards the "load" even though they have no CPU activity (they are blocked on IO).
Shown in top as being in the 'D' state.
It is a useful metric to start digging deeper into the machine.
Maybe we should re-define load average, as the old definition divided by the number of cores.