Auto ISO is especially useful when light is constantly changing, like if the sun is moving in and out of clouds or if I'm moving from location to location, or when available light is especially low. Setting the camera to auto ISO, it will automatically choose the lowest possible usable ISO at the moment of exposure. So, why isn't the lowest ISO always ISO 100 or 50? Because depending on the camera you're working with, you can dictate a minimum shutter speed parameter and/or a maximum ISO setting that the camera won't violate. You set the exposure you want and the camera adjusts the ISO for you.
In practice this means you can set your aperture to wide open (f/2.8, for instance) and your minimum aperture to 1/125th. The camera will automatically boost the ISO as needed to create a perfect exposure with a shutter speed no slower than 1/125th. And, if the available light allows for it, the camera will drop the ISO as low as possible and increase the shutter speed above 1/125th in order to minimize the noise that comes from higher ISOs.
Since high ISO noise has improved so dramatically in recent years, auto ISO has become a much more valuable a tool. The naked eye may not see a difference between ISO 400 and ISO 800, but it's sure going to see the motion blur created at 1/30th of a second instead of 1/60th. Both of those represent a one-stop difference, but it's the shutter speed that can mean the difference between a blurry photo and a sharp one.
Even if you're worried about high ISO noise at the extreme, you're still covered. You can set the camera to never select an ISO higher than 2000, for instance—or whatever high ISO number you're comfortable with.
However you choose to utilize it, one thing about auto ISO is very clear: it is not just a crutch for newbies or those who don't understand ISOs. In fact, it's a valuable tool for skilled photographers who want to be very deliberate with their exposures. It is yet another reason why it's so great to be a photographer with access to all of the technology of today: the possibilities are endless.