I haven’t been caching long enough to remember virtual caches. I’ve talked to some folks who have and there are mixed feelings about this type of cache. The geocaching community does seem to be excited about them though. Opencaching.com has introduced them virtual caches to their site.
It may be easier for opencaching.com to introduce virtual caches as the site lacks a formal review process. In the Garmin press release they mention that virtual caches should have “a cool search or do” component. This is equivalent to what was called the “wow” factor when geocaching.com had virtuals. Getting consensus on “cool” or “wow” is what leads to contentions. My idea of cool might be different than yours. Who will be the arbiter of cool?
Geocaching.com is currently working on virtuals and will be reintroducing them shortly. It will be interesting to see how the different review approaches affects the acceptance and popularity of this type of cache.