I would use them inside xslt transformations, but I think it could also be usefull in a simple expression.
For example, if you want to enrich your message with a timestamp. You would need to do a java callout to get the timestamp (I did not get the current-dateTime() xpath function to work) before you can assign it to an element in your message. It would be much more convenient and readable to create your timestamp inside your assign action using an xpath function.
That's why I was looking for support custom xpath functions.
For more complex functions I would prefer the java callout ....