I think it's a business logic vs. data logic thing. If there is logic that ensures the consistency of your data, put it in a stored procedure. Same for convenience functions for data retrieval/update.
Everything else should go into the code.
A friend of mine is developing a host of stored procedures for data analysis algorithms in bioinformatics. I think his approach is quite interesting, but not the right way in the long run. My main objections are maintainability and lacking adaptability.
