The advantages are as follows:
-Digital, so you can delete pictures that suck (though no LCD, so hard to tell)
-They are reusable for the retailer, just download, and re-"rent"
-The price of the prints is included in the camera purchase/rental so the $11 or so includes the use of the camera and the prints, and a photo CD (usually 10 bucks by itself)

When you factor in the cost of a normal 35mm disposable and developing, you are usually talking more than 11 bucks anyway especially with a photo CD, so it DOES have some advantages. I personally wouldn't use it, but i can see why some people would.