I like it in a place that has high-service standards and is priced accordingly.
A prime example among hotels has been the Elysian (now Waldorf) in Chicago. At Bernard's Bar in the hotel, the bartenders are very clear that prices are inclusive, do not accept any gratuities, and nonetheless provide a very high level of customer service and professionalism. The drinks are, with tip factored out, comparable in price to other good bars in the city and often very generous pours too.
When it works, it's a real luxury.