My children have always (dd) and will always (ds) use an appropriate car seat on an airplane.
Dd flew about 5 or 6 round trips between 17mo and 3.5yrs. Using a car seat was really no problem at all, in fact almost every flight she fell asleep... most times before we even took off!
Ds flies for the first time in December just as he turns 2yo and we will definitely have his seat on the plane for him, even though we don't need it once we get to Florida.
I look at it this way, how would I secure my child on the airplane if I KNEW it was going to go through severe turbulence or a crash landing? That is the way we fly every time... just like how we do it in the car.
There is a great website
here that has excellent advise about using your car seat on the plane.
Oh, and to address children that don't "fit" in the seat... If the child meets the manufacturer's guidelines (under 30-35lbs and their head is more than 1" from the top of the shell of the seat) it is actually more comfy for them to be REAR facing on the airplane. This also precludes them from kicking the seat back of the person in front of them and allows them to face their parent/sibling on the plane!
If the child must be forward facing, make sure that the seat is not in the recline position and assure that the person in front of them doesn't recline either.
Dd is quite tall for her age and was in a car seat on a plane as old as 3.5yo...we had no problems with her fitting.