I have used sheets mostly as backing. I have used some for quilt tops - mainly for kids novelty quilts when I was not able to find fabrics I wanted. They have worn just fine. I have also made quilts entirely from vintage sheets.
Be careful if the sheet looks to be loosely woven, then you will have a problem. If that is the case, iron a lightweight fusible interfacing to the back all the way to the edges like you would a t-shirt.
I have used flannel sheets, 100% cotton sheets, poly-cotton blends, and percale sheets with success.
I guess it depends on what end result you are looking to achieve. I wouldn't use sheets on an heirloom quilt. But for everyday use they wear very well in my opinion. The sheets will wear the same way they would if you used them as top sheets and washed them.
Pilling is usually a result of your body rubbing against the sheets, that's why you don't see much pilling in top sheets. I have had quilt store fabrics pill up over time, too.