I certainly would (and do). SQL Compact (SQLCE) has a distinct advantage in some scenarios. Now it's in no way meant to be a replacement for SQL Server. It doesn't scale, it isn't made to run thousands of concurrent connections, it's not designed for reporting services, etc, etc.
But it has a tiny footprint. Installing is a matter of just copying over DLLs. Backing it up is a simple file copy. And it can be wicked fast for storage and retrieval if you're using table direct or BCP. Oh, and it's free. If you just need a local data store for an app, SQL Server is a pain to deploy and configure. SQLCE is simple. Plus it can play in the same sandbox as a full SQL Server as a replication subscriber (which most other small DBs can't).
Edit: Forgot to answer your specific questions:
- How much data can it handle?
In terms of what? DB size? Throughput? Table size? Row size?
My experience is that I've run the DB out to a a few hundred MB with no issue. I think it can hold 4GB (as of 4.0). Throughput is directly related to how you're putting data in or taking it out. We're using it in a solution where we're capturing 1k rows a second with no problem. You can have 1024 columns and a max row size of 8k.
- Multiple users? Well it can handle multiple simulataneous connections (as of 3.5), so yes, that should work. I've used multiple connections from one user, never from multiple.
- Broken databases? Define "broken". The engine has a "compact and repair" method. It's a file like any other - how do you fix a broken executable? I've not seen any corruptions in the field, if that's what you're asking (well we did on one CE device that had a bad storage card, but that's not the engine's fault).
