I've never been entirely clear on what role VATS "should" play in the game, what clear role it was intended to fill, and a couple things about it's implementation still feel lopsided to me. I just have no idea about the thing, to be honest. I use it, sure, but I've never been entirely sure about how I've felt about it.
For one, it's pretty much entirely a construct of Bethesda's. In Fallout 1 and 2 you could take an aimed shot that took more time to line up (ie, used more AP than a regular shot,) and had a smaller chance to hit for the benefit of a higher chance of a critical if you did manage to hit. It was very much about risk/reward and maximizing your DPS. Other than being able to make a called shot, VATS has nothing in common with that. There is no drawback to using VATS, AP exists solely to fuel it (so basically there were Action Points in Fallout 1, but Fallout 3's AP shares no relation other than the name,) and it means the combat system now makes use to two totally different and unconnected mechanics at the same time (real-time shooting alongside what's basically a percentile-based killcam bullet-time.)
It always seemed lopsided to me that you make a percentile roll to hit in VATS, based on your skills; and those same skills have a totally different impact on the real-time shooting. I don't know how you'd do it, but it would just feel better to me if there was one system that worked equally across the whole game. (For example, in Dungeons and Dragons (let's use 5th edition just because that's the one I'm playing now) whatever it is you're doing you roll a d20, add your relevant bonuses and compare that to the difficulty set by the DM. VATS is like if sometimes you rolled a d20 to hit something, but other times you drew from a deck of cards to do the same thing.) (And for another related parenthetical that's why it's bugged me that some skill checks are tiered and some are percentile rolls - again, that'd be like in D&D if you rolled a d20 to unlock a door but not if you wanted to knock it down.)
But...
I use VATS all the time. When Mass Effect first came out, I started using it's Command menu to sort of insta-pause the game, look around, catch my breath, plan out what I was doing, etc. I'm a turn-based player, I like having some time to think about what I'm going to do. So I used VATS a lot for the same thing - even if I had no AP to use to make a shot my rhythm sort of broke down to going into VATS to plan my next move, exchanging some fire with my chosen enemy, then tapping back into VATS to scope out where I was going next.
I'm also a big fan of the kill-cams and since I play in third-person anyway I like seeing any time it does something cinematic. I rarely found VATS to be terribly over-powered, though. I used it more to catch my breath than an "insta-kill" I suppose. I mean, I'm a turn-based gamer but it's not like FPS games are so complicated or hard that people can't get the hang of it (it really isn't that hard to put a cursor over something and hit a button.)
For Fallout 4 I just have no idea how it's going to play out. Sure, we know some details but it's one of those things I'll have to play with it to see how I feel. I think what I would have liked to see would be instead of VATS, an "Aiming" mechanic that worked almost the same way but required you to remain still and line up a shot - leaving you exposed in the process. But, there's more than one way to skin a cat, so if that's not the road they go down it won't innately mean it's going to be a bad thing...