All of your information could be kept in a central location with mega-bit security and only you would able to use it.
Realistically, you and who else? I'll skip the central server, thanks. The encrypted storage program I've got on my PDA makes me feel a LOT more secure than having all my data in one, central, most-likely-government-and-law-enforcement-accessible location.
If it's an online store I visit a lot, then I do remember my password. Otherwise, out comes the PDA so I can look it up. And really, I have fewer than 10 passwords I actually use frequently... Probably 5 I use for online accounts regularly, 3 I use for desktop/email/hosting accounts, and a couple more for my PDA apps... If I remember the two PDA passwords, I can retrieve the rest.
I find it remarkable how many I actually DON'T need to look up though... and I'd suspect "Joe Average" uses fewer (and easier to remember) passwords for his miscellaneous accounts, making it even easier for him.
It may not be a big convenience, but it gives folks a sense of security, and that's always a big thing.