I interned at a variety of places, from a tiny t-shirt company in NYC to the annual Prague Writer's Festival. I think all were beneficial to me; I got college credit for them, and they still (several years after I graduated from college) are listed on my resume and are often discussed in interviews at some length.
It depends of course what you are looking for: do you want a job to result directly (as in, you get promoted to a paid position) from the internship? Real life experience? Network contacts for the future? Etc. For me, all of those things and more were enormous benefits in my later life, especially as a writer/editor (right now, for example, I'm at a cool company called [url=http://www.myigrad.com]iGrad[/url] that actually helps answer career and finance questions for college students just like this one - go figure! - and in my interview, I focused on how useful my internships at startups were to me).
I interned three times during college; one turned into a full-time job. All were useful, both for skill-building and helpful contacts - plus, an internship can provide mentorship opportunities not available at all universities.
On the flip side, I believe people should be paid for good work, even if they are in college. Not everyone can afford to work for free, and I hope more employers acknowledge this and either offer a stipend or hourly wages to interns after a probationary period.
What's your view on the fairness of unpaid internships? To me, that's the biggest issue with them - not their usefulness, which I don't dispute. Thoughts?