One thing to keep in mind is that everyone's sensitivity to light is different. For instance, I had lasik surgery several years ago, and a side effect (for me at least) was to reduce the actual amount of light reaching my retina; I typically need more light than other people to see well. The auto-brightness setting always results in a screen too dark for me.
If there was a way to fine-tune the baseline brightness level, I might find the feature useful (especially since manually changing the brightness requires a few clicks through the menu), but as it is now I think it's probably only useful to a relatively small subset of people.
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