No, I won't really go down the road of comparing these two organisational ideas in general since other people with more knownledge in this area have probably done this already to the degree where it's no longer funny. Instead I simply won't to write a little bit of my own experience with blogging using Tags instead of Categories.
A few months ago I installed Jerome's keyword plugin and modified it a little bit to fit my needs. From that point on I used tags basically exclusively to organize my posts here. Categories seem to me far too strict back then so using Tags was a logical choice. Still: You always have to come up with the keywords yourself, which is sometimes - at least for me - quite annoying.
Basically I'd love to blog completely without categories and tags just using a good search engine with a useful indexing so that I won't have to think about keywords myself. That's one of the reasons why I was thinking about using Drupal for blogging, since it's (AFAIK) rebuilding the search index via cron and not whenever a user is searching. But in WordPress you have to use some category or tagging system to not have to use the search function excessively.
Another downside of tagging is, that it's not part of the MetaWeblog/Blogger/MT-API so you can't simply tag using one of the many external blogging tools like the Performancing plugin (which I'm using right now to write this post) or Flock. If I will keep using these tools with WordPress 2.0 (with it's WYSIWYG editor) is a completely different question (at least after I've started extending it a little bit ;)