I used this for a while on Linux when there was a codec war between Firefox and Chrome (forgot the details), but I could play videos that normally only played in Chrome without problems.
Browser vendors cite usability problems (if one person's browser supports more codecs than the default, then it is confusing for other people with the default browser... and the person with more codecs might create websites that depend on this), and stability problems (plugins in any form have a bad reputation, but actually the default OS media player codecs are of pretty good quality as they are excercised thoroughly). But honestly, I think it is mostly politics that this is not enabled.