Paul,
CRTs and LCDs don't have the dynamic range in brightness to be able to show astronomical objects at realistic intensities. At least with the normal stars setting (not as points) there's some variation in their apparent brightness, although nowhere near as much as there would be with an ideal display device.
I've found "stars as points" to be useful when trying to align things, but in general I think that setting is most useful in improving performance when the variations in brightness don't matter.
For what it's worth, I think it'd be nice if Celestia supported a much wider range of intensities for stars, even though it would have to do it by giving them much larger diameters.
Partiview does it, why can't Celestia???
Note I said it'd be nice, not that it's important so far as I'm concerned. Others may feel differently, of course.