For the same bragging reasons that MHz was used for in the computer world. Similar to how CPUs are now moving away from the more MHz = better trend, the compact digitals seem to be including more random features to distinguish them.

That said, I've got the Canon 960IS which has a ludicrous 12MP which to be honest I can't see any noticeable difference. My old camera was a IXUS 500 and it produces similar photos and the only reason I upgraded that the lens mechanism broke. The 960IS was on special offer at the time.