bluehaus: I use WordPress as the web site delivery tool of choice for all my web sites, i.e. - I have a couple going, and will do the rest over time. It would probably qualify as a CMS, too, as I store some of the information in a separate database, then use WordPress to dig it out and present it on a web page. I had used Etomite (also Open Source) previously, but am glad I made the move.
In short, I have never created a Post, and do things with Pages.
At first, I began developing have one (separately customized php to access database content mainly) template file per page, but quickly saw the difficulty I was creating for myself, down the line, trying to change one piece of common code in all those template files. So, I built my own parser to look for double square brackets where I specified the name of a custom field that could exist in either the current page or the home page. Most of the custom fields have names ending in .php so I can execute php. But I also have a few other things, like html that won't make it past the tinyMCE HTML editor that WordPress uses to let you edit Pages.
As for pros and cons of installing in the root v.s. a subfolder, I haven't seen any formal discussion beyond what is implied in the documentation that tells you how to run your domain name with WordPress in a subfolder: http://codex.wordpress.org/Giving_WordPress_Its_Own_Directory
Part of the reason for that is that the ability is relatively new. For me, the decision was a No Brainer -- always install in a folder, never in the root -- because there are always "other files" in a root of a domain name, and who needs the confusion of keeping track of which is which? The folder switch ability cannot be underestimated for its flexibility to quickly switch from one WordPress to another.