No, it is quite reasonable with efficient implementation. 10-50% overhead or so depending on function size distribution (since it is small fixed overhead per call, smaller functions result in a greater fraction of overhead). 10x for just function entry/exit recording would be grotesquely inefficient. You can do inefficient time travel debugging recording for less than that.
You do need to allocate a ton of memory for the recording buffer to record sizable amounts of trace data. GB per core-second of trace or so (ring buffer so you get to see the last N seconds, not you need to run for less than N seconds) but that is fine during development on normal dev machines.
It is useful for everything. Why would you not want full traces for everything? It is amazing. We use it for everything internally where I work. Or rather, it is part of it. We actually prefer full time travel debugging during development and automated testing (again, overhead is low enough) but it is not available for everything. So sometimes we are stuck with just traces.