The advantage of an automatic breadcrumb system is that it drives PR up to the main pages of the site.
Think about it: the top level pages (eg. your root index page and your top level category pages) only link to themselves and the page directly below and thus "hoard" PR to a certain degree. The pages below them, and below those ones, link to all of the pages above them in the chain. It's an effective way of getting PR from incoming links to your deep pages and funneling it to your higher pages.
So there's no magic to it, but it is a reasonably clever technique for cranking link juice to your top level (most competitive) pages. You don't need to implement as breadcrumbs as such, but pushing your link juice to your most competitive pages is always a good idea.
Of course, no amount of rearranging of internal PR flow is going to compensate for not having enough external backlinks in the first place.