Why persist in using HOME folders?

Essentially, yes it is. The only benefit of a home folder is that it doesn't require any time to synchronize during login / logoff.

neither do redirected folders once it has been setup.. I can't fathom the difference.

Hmmm...Nice question but I don't see any reason to keep both folder redirection and home folders

Folder rediretion and hown drive is two different policy.Folder redirection redirect profile data More see this:http://technet.microsoft.com/en-us/library/cc732275.aspx

Its depends on business requirement where you need home drive seperately.But if is not required you can remove the same.

However you can use the folder redirection group policy to create the users home drive.More see this:http://social.technet.microsoft.com/Forums/en-US/winserverGP/thread/cb8ceb41-22af-4509-821a-746af7669b33

Hope this helps

So home folders are just a server based area that the user CAN store data AKA a work folder (for work related data) that it is exclusive to that user and they still have their normal documents, etc folders on the individual machine.. Am I getting it right?

Yes, that is correct.  

Whether you use folder redirection or a Home folder, the concept is to ensure that the user's documents etc are stored on the server where (hopefully) there is a regular backup procedure. It's time consuming and inefficient to back up every workstation every night, but it's reasonably easy to backup the server each night (or more).  

Folder Redirection is often more convenient simply because the user can save to the normal "My Documents" folder (which has been automatically redirected to the server).  This means that the process and/or default file locations for the end user doesn't have to change, yet it ensures the documents are stored in the server for safety purposes and prevents data loss in the event that the workstation stops functioning.  When using a Home folder, which is often a separately mapped network share, the user must make a conscious effort to change the file location when opening or saving files.  It also means that items such as the desktop, start menu, etc are not located on the server and would have to be rebuilt if the user switched to a new workstation.

That is exactly why I keep seeing people use home folders and not folder redirection and my impression is that it is a relic of days gone past. I can't see justifying it when folder redirection offers so many more advantages.

Thanks for the confirmation..

My pleasure.  Thank you for accepting my response to your question, I am glad I've been able to give you the assurance you needed to confirm your beliefs.