I personally see two main advantages in using hardware...
One being the "fun" factor, which many people seem to forget quite often in production forums, I personally dont enjoy myself with just Logic and some VSTs, while I can turn my uber simple and limited Korg ER1 and spend the entire afternoon doing loops and bleeps with a smile in my face... of course, this is personal, as many people have the samm fun with software, I just cant do it
The second would definitly be the fact that when using VSTs you are generally emulating or imitating analog subtractive synthesis, therefore I personally cannot believe that using an emulation or the real thing is the same... when using VSTs I tend to spend a lot of time during mixing making them sound "analog" (by adding some noise, equing, putting them through some analog fuzz and filters, etc), something I dont need to do when using analog synths... I personally believe tha digital (and therefore software, as I believe the most powerfull digital synths are in the box) has its own advantages and powers, but when this tries to imitate analog it doesnt make sense, why would you use a digital simulation of a square wave in Massive if you can buy a mopho and have the real thing going on? On the other hand, synths as Max and Reaktor are the beast as they do not try to emulate or overlap analog synths (appart from the modular concept), there is already a family of instruments that are build to create your raw nasty square wave, digital should be used more for granular, additive and other forms of synthesis that are nearly impossible or unusable (because of stability and stuff) to achieve with an analog
by the way, as someone was asking in the third or second page if we use analog outboard... I use a pair of Studio Projects VTB1, which are not fancy but do have a sound of their own and can make VSTs shine as well as making vocals stand pretty well. I also have an ART PRO VLAII which has to be the best addition to any project studio or homestudio, it sounds great and seems a totally different approach to using software compressors. I am also using a lot the filter in my Slim Phatty and its "overload" function to distort a lot of my electribe drums (i love to put my drums through that filter and then go crazy with the phattys LFO while controling the cutoff)... I also have quite a lot of guitar pedals which are great for mixing and getting efx... I kind of get a bit annoyed when people claim hardware is expensive... I bought the VTB1 for 110€ a piece, thats the price of a lot of hardware, also many of my pedals are dirty cheap such as my beloved Artec Analog Delay. which is an amazing analog delay that costs 40€ in Thomann, also I have some electroharmonix boosters and fuzzs and all are under 80€, I kind of feel that these little pieces bring a lot of character and new dimensions to your sound and you dont need to break the bank
We are so lucky to live in a world with so much music