Years ago, not long after XP was release (it's weird saying that), I found my computer slowing down noticeably, so I went on the hunt for a better than in-the-box defragmenter.  I don't recall how, but I came across Diskeeper.  So I tried it, and voila, I noticed an immediate improvement. 

Ever since, I've been sold on using Diskeeper, and I stuck with v7 until this year.  Both Executive Software (DK's maker) and Raxco (makers of PerfectDisk) were kind enough to give me copies of their latest version.

Right now, I'm using PerfectDisk on this laptop, but on my two other in-service machines I'm using Diskeeper.  It's hard to say if either defrags better than the other.  I imagine they both do about as well, though I dare say each has things to recommend it on that front.  I don't have the time or resources to do any kind of benchmarking between the two.

That said, I find I like Diskeeper better.  Maybe it's because I've used them for so long, and to be honest, PerfectDisk (a trial version a year or so ago) killed my external USB hard drive (maybe it was on its way out, but it definitely died after my attempt to defrag it).  I've not seen similar issues with my current version of PerfectDisk, so I can't say if it was or wasn't the fault of the software.

As for Diskeeper, I like the new UI in 2007; I'm a sucker for attractive UI.  I also like what they've dubbed "InvisiTasking."  It runs all the time and really doesn't interfere with my day-to-day activities, and on my laptops in particular, it's nice not worrying about keeping them on overnight. 

It took me a while to trust it--I'd grown so used to scheduling, and I don't want anything interfering with my perf.  But I haven't noticed it interfering, certainly not as much as, say, the MS desktop search indexer.  MS could learn something from Diskeeper in terms of how to actually run in the background.

Oh and it works great on Vista from what I can tell so far.  Smooth install and no issues with UAC and the like.

The problem with regularly using a defrag tool is that it's hard to say if it is really helping.  After my first experience, I've taken it on faith, but Diskeeper has a nice history log that shows the fragmentation history, and I can see a correlation on days when, e.g., I've installed or uninstalled a Visual Studio CTP.  So I think there must be something to it; I certainly can't complain about my system performance noticeably degrading over time like it did when I wasn't using a defragmenter.

Anyways, if you're looking for a defrag utility, I would actually recommend Diskeeper. I'm no file system expert, nor have I created control groups to objectively test anything.  But I do think it helps, and I like the latest version's UI.  So take it for what it's worth. :)