Sandboxing isn't to prevent people from damaging their own computer (i.e., the "sudo rm -rf /" case), it's to impose a ceiling on how much damage can be done by an exploited process that the user doesn't realize has been exploited. It's not to save you from yourself, it's to save you from stuff that you wouldn't otherwise have any way of knowing was even happening. Sandboxing restrictions are more like using asserts in your code than anything else- they only stop programs from doing things that the programs themselves are stating that they would never attempt to do.

Having said that, plenty of useful apps can't ship in sandboxed form because of limitations in the current sandboxing model. And of course the fact that sandboxing is required for store distribution makes the store less useful. The implementation has much room for improvement, as do the store distribution policies.