Use Multiple Years of Swks? Why?

Customers requirements mostly

Yep, Customers, I got 1 client who uses SWX 2004 and another on 2006, the rest are either on 2007 or don't have CAD
Kev

Performance. You take a hit in performance with each new release. If you have thousands of legacy files and find it impractical to convert them you take a performance hit. If you create new files you may also find a performance hit.
Customer's needs. The customer is always right. If you can't deal with the customer's files you won't get very far with them unless you can do something nobody else can.
If you work a few years back it is no problem to move a model forward for the customer and for you. By working in an older version you can cover a larger spectrum of customer's unless you are doing bleeding edge stuff.
Training. I find that the majority of SW users simply don't take advantage of the new features in each new release. This is more true of long term users and less true of new users. If you go through essentials training there is very little from release to release that is new, i.e., from the latest release and not in previous releases. Given that most users are on the level of Essentials users there is really not a big motivation to move up.

I might say "Right on TOP!"... No one else mentioned the performance issues until you raised it.
There are also indeed the vast majority of work that doesn't need bleeding edge features as you noted. Machine design and a great lot of consumer product design doesn't really need the latest surfacing.
I found it very interesting that the Apple iPhone (which was derided by many "journalists" & well known CEOs of competing companies from Microsoft to Palm) looks, feels, and works like I expect a cell phone to do, and does everything it does darn well, and could still be modeled (as I did) in an early release of SolidWorks with no problem. With a Bluetooth earpiece (noise cancelling), I rarely fiddle with the phone itself.
Good design is design that works.
Bo

We're too busy working on the new designs to go through the often painful process of converting the old designs to the new software.
Jerry Steiger Tripod Data Systems "take the garbage out, dear"

Jerry, indeed that is the proverbial "Quality Control/Quality Assurance" problem that plagues some companies today when trying to meet FDA or other stringent traceability & guarantees for compatibility. Change something and then we have to guarantee "everything" is perfect.
Unfortunately it doesn't always work that way with 3D CAD file updating.
The time required to verify can be enourmous. I have even given up a couple times and remodeled some parts from scratch to make them work right.
Bo

Perfomance changes from one release to the next are a mixed bag. Some things aare slower, some things are faster. For example, working with drawings took a jump in speed for us on 2006. Insertion of library features took a speed jump for 2007.
Not all of the enhancements are focused on surfaces. Enhancements in 06/07 wrt to annotations in models and drawings have been beneficial to me in the broad category of "machine design". I think the issue of performance and enhancements from one release to the next needs to be evaluated on a per- user basis. I have not seen a release since starting in 99 that did not have more positives than negatives.

Well, SWks plans to drop some of the extra items like Mold Flow Express soon, as I recall, so there are some items than may go missing as we go forward with releases.
Bo

Absolutely. One man's meat is another man's poison
We were happy to upgrade at every chance from 98+ through 2001+. We then held out till 2004 and then 2006. Now we seem to be back in the groove with 2007 and expecting to switch fairly soon after 2008 comes out.
Jerry Steiger Tripod Data Systems "take the garbage out, dear"

Basically,... Each version has features which each client either can tolerate or fits needs for their use and we as designers/groups have to support their needs. (some clients are smart with staying with the stable releases and some are not.) And, then, there are the new clients or should I say, new start-ups who buy the latest release (because they want the latest version to brag to someone they have the latest...blah, blah,..) and we support designers/groups have to support their needs. (NOT always FUN! And, I have total proof on at least 2 projects using SW2007, which I lost a lot of time/money!) This is the way it has always been,.... it just gets worse when software becomes chaotic buggy BLOATWARE and the QA around that software, like SolidWorks, becomes a next release promise company fixing and breaking code. (GREAT BUSINESS MODEL!!!!!!!!???????)
.. (that is, it's time to look at alternatives to stay alive..)