I have godparents, I am a godparent (3 times - Madison, MacKenzie and Connor), and my children will have godparents. I think it is a necessity, IMHO. I try to guide these children, teach them things about life, and my DH and I are the people in the wills that should anything happen to the parents, all of them would become under my care.
I think it is a very flattering honor. I know it is not just a catholic thing, as I know lutherns, presbyterians, and episcopalians do it, too. That is what all my cousins are, and all of them have godparents...