I run Kitty and use this feature regularly. Most of the time, I rely on it within Yazi [1], a TUI file manager, but I can also display plots within the Julia REPL, thanks to the KittyTerminalImages.jl package [2]. It's even more crucial when I'm navigating a remote directory and need to check an image file, as I usually have timg [3] installed on those servers. Once you discover how valuable this is, it becomes a permanent part of your workflow.
Definitely. I use KittyTerminalImages.jl often, and also the image.nvim plugin for embedding images into a Markdown or other buffer in Neovim: https://github.com/3rd/image.nvim
[1] https://yazi-rs.github.io/
[2] https://github.com/simonschoelly/KittyTerminalImages.jl
[3] https://github.com/hzeller/timg