I've never used it, I stick to using my iPod. I never actually had enough space on my SD card to have any music on my 3DS. That'll maybe change after today.
I use it as an mp3 player. I don't own an i-pod or any music player myself so it's a good substitute. I previously had an R4DS as my music player but that stopped being read on my DS long ago.
I use it to play music quite a lot. Not because I don't have a phone or an iPod, but it allows me to play music on it, while I leave my phone free to take any calls if need be. The funny thing is, the more I use the 3DS, the more my iPod is getting pushed to the back of the drawer. I think the case for me is, with the 3DS, you can do a lot more than just play music on, you can play games on it too, which is so much better than an iPod or phone.
I have never used the 3DS Sound ( the application ) because I don't think that it is useful. I own an iPod and a MP3 Player, so I am not in need of this application. If I didn't own them, I would possibly use it every day because music is my life. Technology has improved very much and you I believe that Nintendo is just for gaming and MP3 Players are just for music.