The W7 native defragger is undoubtedly better than no defragger, but as mentioned, it is quite basic. And very slow, with minimal reporting/GUI elements.
Commercial defraggers offer flexibility in configuring the defrag parameters for each volume, fast defrags, ability to defrag in adverse conditions (low space, fragmented system files), auto defrag etc. Ofcourse, these are not free, but if the feature set/performance is appealing to the user, then it's a worthwhile purchase.
I am not in favor of the freeware defrag utilities..most have the same limitations as the native utility; and without the safety-net of support and reliability offered by the commercial solutions.