mDNS has utility in small networks for your average Joe. In these circumstances (1) it shouldn't be a problem, (2) it shouldn't flood (there's logarithmic decay and there actually has been thought put into this), (3) names are discoverable without relying on anything else, (4) and it does its job in being the mechanism for DNS-SD to piggyback on so that services can be discovered automatically. Being independent of other services working or not — e.g., DHCP, (unicast) DNS — means "it just works", even if other network services fail.

There is a beauty in the ability to just have all of your computers, printers, and peripheral devices otherwise plug into a switch (without any additional network service equipment — no router/dns/dhcp multi-combo device added in the mix) and that everything just ends up working. Link-local addressing takes care of IPs, mDNS takes care of names, and DNS-SD through mDNS takes care of automatic service advertisement — "Hey, I'm a printer, use me if ya wanna!"

Further, failure of proper mDNS implementation in a device (perhaps resulting in malformed packets or over-zealous flooding) is just a failure of that device's design, not mDNS per se.

Having said that, still... yes, I think the home/SOHO router/switch/access-point/dns/dhcp multi-combo device should handle DNS-SD registrations and DNS, and that mDNS shouldn't be needed.

In medium/large networks (those actually managed by someone putting on an IT hat), it's perhaps not as appropriate, but still shouldn't be a problem assuming everything is subnetted with mDNS in mind. Of course, name resolution is handled by unicast DNS, and with regard to service discovery in this context, someone manages the DNS-SD records on the unicast DNS server so you don't need mDNS to be the mule for DNS-SD to ride on in those circumstances.