I think it depends a lot on how long the letter is, what you include, and how many people you send it to. I get a few, and they tend to feel very impersonal, because they either contain a lot of stuff I already know, because I'm actually in contact with the people concerned, or a lot of stuff that I'm not remotely interested in. (I get one every year from a woman I worked with briefly, 10 years ago. I never met any of her family, we never had much in common other than our job...2 pages of thinly veiled boasting about how wonderful her life and family are doesn't really do a lot for me! (I also find it bizarre that she goes to all the trouble of putting this letter together but has, apparently, never once in 10 years stopped to think that putting her return address on it somewhere might be a good idea - I haven't sent her a card in 10 years, because I don't know her address - apparently 10 years of silence is not enough to stop her sending the letters...))
I would rather have a short summary inside a card, as that feels more personal.
That said, I think they can be useful for keeping in touch with family or friends you don't see often, although if you can, I think it's nice to try to personalise the letters a bit, rather than just printing 20 or 309 identical letters - that way, it feels more like a real letter as you can include mentions of the recipient's family / interests.
I suspect it is another 'know your audience' thing :-)