When reaching today's tech-level, the MLRS is indeed useful to bombard enemy infrastruture (and units) over a great distance. Since the distance is farther than the artillery, it's not a correct MLRS implementation. It's really more of a SCUD-launcher.
[edit:] I am not sure about the rate of fire, was it once per turn?
Well... even the AI manages to facilitate the use of this unit in a dangerous way.
RL-note: ( As the current war so cynically tells us, Civ3 MLRS is more an implementation of a cruise missile system than the Civ3 single cruise missile. I think using it on cities should contribute to evil reputation in Civ3 )
