This pretty much exactly describes the experiences that our various teams have had. We've tried all manner of software tools over the years (Jira, since we use that for bug tracking already, Jira + Greenhopper, Agile Zen, Pivotal Tracker) and we pretty much always end up coming back to having cards on a board. Every tool ends up feeling too restrictive, too big brother, and too TPS-report-coversheet. The point starts to become "get the right data into the tool" instead of "use the tool to help us do our work."

We generally end up putting everything in Jira anyway for historical and statistical purposes, as well as for visibility when people are working remotely, and it simply ends up as someone's job to make sure Jira is in sync with the physical board every so often.