As a previous moderator, I can say that I liked the "report post" function. It made it very easy to keep up with any "problem" threads or posts when they pop up in the moderator forum; it sure beats having to stumble upon a problem post/thread/member in our normal reading of the forum. In addition, during my tenure, I don't recall any member really abusing the "report post" feature. Sure, some people used it a bit more than others when the member thought a post or thread was not compliant with Stormtrack rules, and this can probably be attributed to different levels of "sensitivity" -- some folks tend to get offended more easily (right or wrongly) or tend to see a particular post as being outside the ToS when others do not. The fact that I cannot remember any members who reported posts more frequently than others is evidence that moderators (at least during my tenure, though I assume it's still true) do not make "personal" notes or look differently upon members who frequently (or the opposite - never) report posts. Reporting a post is a form of community policing that many times more than not improves the quality of the board, even though there may be isolated instances wherein a moderator must use his/her own judgement to take preliminary action when the matter is pressing.
I do remember more than several times when a particular member reported a post, and the moderators, upon discussion, did not agree with the premise of the report and made no action on the reported post. However, personally, I'd still encourage members to use the "report post" feature and/or to contact moderators directly if a member has a problem with a post, thread, or other member. As noted, reporting posts to moderators when necessary (e.g. when a post is not complying with forum rules, etc.) is often the quickest way to get it to the attention of the moderating staff. Otherwise, it probably won't be noticed until a moderator crosses it during regular forum reading/browsing.
Note that I do not represent the thoughts of the current moderating staff, but I figured I'd give my 2 cents. I also think that constructive comments like we've seen in this thread can help ensure that this board serves the best interests of its users.