Last week Mardy Fish served as the almost perfect example of how to make appropriate use of a wildcard. Cutting the "almost" it's most likely Goran Ivanisevic's Wimbledon victory coming to people's minds.
In opposition to these achievements, there's many tournaments each season handing wildcards to local boys or seniors, who in many cases are clearly the underdogs in their first round matches. By doing so, organisers take at least 2 spots per tournament from players, whose ranking would have allowed them direct entry and better chances for a good run instead.
Keep them, but perhaps there should be more scrutiny on who those wildcards are given to. As I understand it the decision is now largely up to the tournament director and/or national tennis association, leading to some questionable wildcard entrants. Perhaps there should be some ATP / independent body influence, or would someone who knows more about this area like to clarify the present situation?
This is such a non-debate. Of course they should be maintained. They provide young players with a great experience to play against and practise with higher-ranked guys, which can significantly aid their progress. They give players coming back from injury the chance to climb back up again without having to use their protected ranking for the event. They allow the crowd to see local players or more famous names rather than having the no-name next-ins contend, which would be detrimental to both attendance and TV ratings. They allow smaller tournaments to build up a rapport with up-and-coming players, so that they are more likely to come back to the tournament once they are among the game's top dogs.
Self-evidently bad decisions are frequently made - and sometimes WCs are even bought, especially in Challengers and Futures - but in general there are mostly merits to the system.