Well, I must assume that the OP is already on his way to Vegas, so this is for posterity...

I've done all the permutations of renting a car vs. cabs vs. buses vs. free shuttles vs. hotel trams vs. monorail vs. walking, etc...

In general, first time visitors are best served using taxis and the bus. They're usually on the strip, and most of the major sites are within a few miles and well served by the bus or hotel trams. Besides, walking the strip and taking in the sights can be great fun.

It doesn't take that long to get to downtown from the strip on the bus, depending on time of day. If you're going in the morning, it's pretty fast. Late afternoon, it's not too bad, but it'll take about 30 minutes. It does slow quite a bit mid-strip, but once you get past the Wynn, it picks up. Besides, if you're a first time visitor, most people use the time to sightsee, which is good from the double-decker buses.

For subsequent visits, getting a car is useful because it gets you to the off-strip properties and other sites, like Red Rock Canyon, Valley of Fire, or Hoover Dam. If you take the time to become familiar with the backstreets around the strip, a car can be a relatively quick way to get around. People are usually at the point where they have a specific idea of where they want to go, rather than simply casino-hopping and wandering around.

As noted, if you're partying or drinking, then cabbing it is the way to go, unless you have a designated driver.

I personally don't find the traffic or driving on the strip to be all that daunting, and I don't find it all that much slower than taking a cab. After years of commuting in the SF Bay Area, stop-and-go traffic doesn't faze me. Besides, I enjoy driving the strip and taking in all the neon.

At this point, I usually base my decision on whether to rent a car or use other transportation entirely on economics. I figure it takes about $10 to cab it to most places I go. So, roundtrip is $20. I can usually rent a car for around $25 a day, so if I'm going off strip more than once a day, I rent a car. If not, I stick with public transportation and cabs. For me, the decision is based on what I intend to do while in Vegas and where I want to go.

For example, I'm headed to Vegas for March Madness - arriving the Wednesday night before the first game and leaving Sunday evening. I'm staying at the Aladdin for the first two nights, and then moving to the Stratosphere for the second two nights. I won't bother with a car during my stay at the Aladdin since I'll be mostly at the sportsbooks all day and won't venture far from the strip - maybe a trip to the Palms or Hard Rock. Any occasional trips I have up and down the strip can be handled via the Deuce or a combination of walking and trams. However, I'll rent a car for the time I'm at the Stratosphere. The Strat is far from most places I want to visit, so it'd be easier to have a car to get around. I could just take the bus, but since I'll be "commuting" fairly often, it's just more convenient to have a car.

I do find that if I have a car, that I tend to travel around a lot more.