I second eww's point about newer applications requiring a later version of OS X. For example, if we want to continue using Safari with Panther, we're stuck with 1.3, which may not be quite as secure as version 2 or 3, and sometimes it can't handle some web sites (YouTube stopped working for a brief period). Still, we can use Camino or Firefox.
I think a lot of applications require the 'Core' graphics in Tiger and Leopard. And many shareware/freeware applications now require 10.4 and above, perhaps because the developer may only have one version of OS X and cannot test the code on an older version.
I haven't used Tiger or Leopard, so can't say if Panther is better, but there have certainly been occaisions when I needed to have Tiger to run some shareware I wanted. I'll probably upgrade one day, but it maybe when I upgrade my aging iMac.
Cheers,
Dan