The only reason to hash passwords is security, which is why it's pointless to provide an insecure password hash. And you know MD5 is not secure. It's useless. All it can do is provide false sense of security.
The MD5 algorithm is still used as HMAC-MD5 in PBKDF2 (pass+salt | iterate X times), it's also useful for simple message signing or as a pseudo-random algo for uniform key hashing (data distribution). It should probably be displaced though
It's also not as much MD5 itself that is the main issue with the simple password hash function, but that it doesn't use HMAC and only a 32-bit salt. It was just meant as a placeholder and never really for public use.