The photographer will use your own camera if you want. Keep in mind that can often mean they snap a few shots with their camera and then take one with yours (their shots are the ones potentially getting Disney some money after all). We have had some CMs do more than that but overall that's been our experience, especially at character interactions. We also tend to not visit many photo opportunities when we don't have Memory Maker.
"Worth it" is subjective, there's no right answer. What is worth it to me may not be worth it to you. In years past (when I didn't have AP which includes MM), I have paid the $169 if it was a family trip for around a week or so. I wouldn't spend the money if it was a long weekend with just me and DH. I like having photos of my entire family, and the magic shots and ride photos can be fun for us to have. I like to enjoy the character interactions and not worry about taking photos of it all instead of just being present. There are others who would say it's completely not worth it even for that, and they aren't wrong- it's just really up to the spender.
ETA- you can download all of the photos they take. If you want to order prints/ photo books/ photo gifts that is an additional charge. It can either be done through Photopass (which is pretty expensive) or you can download your images and have prints/ gifts/ books made elsewhere. The $169 is for the digital images, and rights to print. I have over 250 photos from my last 6 day trip.