This is true. I have a bell because the local laws require me to have one. It is of limited use on the footpath and utterly useless in traffic. I have an indicator system with an 85dB piezo buzzer which works okay, but some people don't associate the "beep" with a bicycle, it's mainly so that I don't forget to turn them off. (Got the idea from the postie motorcycles that have a similar arrangement.)

Most drivers I've found around here are fairly decent. I have my close calls, worst being with taxis from one particular company (we have two operating in Brisbane) but in general I've had few problems. The one and only time my horn has seen use on the road was behind a driver that was half-asleep at a green light and needed the wake-up call or we'd have missed the cycle.

On the road I follow 3 rules:

1. Avoid an accident
2. Be predictable
3. Be alert

On the footpath a bell has to compete with increasinly distracted pedestrians. The bonus of a loud bell/horn arrangement though, the louder it is, the further away you can be when you ring it. So instead of practically sneaking up on the unsuspecting pedestrian then scaring the crap out of them, you can ring it when you're a good 30 seconds away, and give then plenty of time to turn around, see you, then move to either side of the path. No one gets hurt, no one gets scared, no one inconvenienced.