I've always known that RAW existed as a way to shoot digital; I knew my camera could do it. I was also totally intimidated. I read an article once that said that National Geographic photographers shoot in RAW because you can't create a RAW file, so it was a way of proving ownership of an image (or something. It was a long time ago) I knew it allowed a greater level of control in post-processing, but I was only shooting snapshots, so I was fine with the occassional playing around in Photoshop, and I didn't feel the need to switch.
Now that I've switched (to RAW) I can't imagine going back to JPG!
I took Max to a pumpkin patch near my parents house today; it was just the 2 of us, which was nice, but I'd wanted to stop and steal (I mean borrow; I had permission!) one of my dad's nice lenses... as I dug through his camera bag, I saw his 85mm 1.8 and snagged it.
Here's an example of what RAW can do for you! :) (SOOC means Straight Out Of Camera)
Images shot at f/2.2, ISO 400, 85mm