Isn't a method that gives an approximate or best-fit estimate to a problem still an algorithm, if it terminates?
I personally don't find heuristics beautiful. That's why I commented.
Your objection seems to be
> You can find pathological cases for k-means such that it will never converge on anything useful
As has been pointed out more than once, a good implementation of k-means is guaranteed to terminate in a finite time. And whatever you mean by "useful" doesn't seem to appear in Knuth's definition of an algorithm.