I have found what is probably the best argument for a literal translation. I have certainly used literal translations frequently in commentary, though I favor dynamic equivalence for reading ease.
But Bob MacDonald, whose blog Bob’s Log has just joined the Philophronos Blogroll, does some extremely interesting work on structure in the Psalms. Now you will get various discussions on this topic scattered through commentaries, but it’s hard to find extended material on the structure of various items of Hebrew Poetry. (Note my own work on the structure of Psalm 104 from a college paper.) Bob has also done some really good charts on the structure of Hebrews, which are on my reading list.
In any case, there is a level of study that can be facilitated by the kind of translation he does, though most of the people I encounter in Bible studies would not have the patience for it. That’s their loss. I’m happy to try to provide what they are interested in, but there are some wonderful benefits to be gained just from thinking about this kind of work.
I welcome Bob’s Log to the Philophronos Blogroll.