I believe many use them for Crumb Quilts. I tried and few and they worked fine for that. Keeps all the seams nicely tucked away.
As for PPing, sure you could do that, though how are you going to transfer your pattern to the dryer sheet? You could trace it on there, but I'd be worried about the consistency.
I find the tearing off part to be finicky too ... though by keeping my stitches very small, the paper does come off pretty easily.