The funny thing about flight mode is you never get to use it in flight :)) at least not yet in India.
The wiki link for 'flight mode' (http://en.wikipedia.org/wiki/Flight_mode) says clearly that flight mode allows a cellphone to be left on while the phone's owner is in an airborne plane. It is useful when you want to listen to music or play games while in an airplane.
I have traveled in most domestic airlines in India and invariably, despite my repeated pointing out that keeping a phone in flight mode does not interfere with the air traffic control signals, the in-flight attendants are stubborn that the phone be switched off rather. I have seen the same predicament faced by my co-passengers a few times though by that time I had wisened up to rather keep my phone off than draw the attraction of the air-hostess unnecessarily.
If they are concerned that the phone can be put quickly into the 'phone mode' from 'flight mode', I think it is really stupid because it probably takes one a little more than 10 to 15 seconds to switch on a phone from off mode! And it amounts to the same thing, isn't it?
However, I have also seen cases where some BlackBerries are made an exception to. Some of my flight co-passengers have been able to keep their BBs on in flight. It is clear RIM has a special tie-up with the airlines or I am missing something. ;-)