My MCSE was the deciding factor my boss used to hire me over the other two applicants. The problem, as I see it, with certifications is two fold. First, there are the folks who obtain them from less than honest methods, thus putting all holders of said cert under suspicion. Certs don't really have any way to ensure competancy. Just that you know how to fix things 'in theory.' The second problem would be people who see, for example, MCSE and assume that means you're a Microsfot God and know everything. If you don't, well then you must be a 'paper cert' guy.
I've got certs up the wazoo. No college degree though. (Yet. I'm working on it, dammit!) To me, the college degree is more important than any certificaiton. Even above a degree, is actual know-how.