I get asked this question a bit from people who have heard of WF but have not read much about it. This applies to BizTalk Server 2006, Office SharePoint Server 2007, SourceCode K2, Skelta, Captaris, other BPM products, etc. Here's how I explain it. I'll try to avoid the million analogies that could be used here.
WF is a software developer technology
WF is not a software product
To review WF is a great technology for building software that has process, workflow or business logic requirements. Software products can benefit from this by using a common low level engine and focus on implementing business value for their users. But don't think WF is a product you can directly deploy for an end customer.
Build versus Buy
Instead of asking whether you want to use WF or some product for your solution. I would recommend another question. Ask yourself whether you want to build a software development project or whether you would prefer to buy software from a vendor. WF is a technology that you could use to build the software yourself and by releasing it as part of the .NET Framework Microsoft has essentially made the build argument stronger. But we also made WF available for ISVs who are building the products you might otherwise consider. And that means they can build on top of it to provide all the higher level features and business value that isn't in WF.
Related Questions
I'll try to answer these in later posts. Feel free to comment on this post with other questions about WF you might have.