Whilst I don't particularly consider RE to be a "useful" subject (let's face it, I am not going to consult on my RE knowledge as much as I would with business, finance, science, etc. after leaving school), it is a subject that does spread awareness of a number of religions and the philosophy behind them. I mean, one way of reducing xenophobia (or unnecessary xenophobia depending on your stance) is to educate the masses (as we can see in recent events).
If you don't know what you're talking about, you shouldn't really contribute to the discussion. If you don't understand what is going on, it really helps to educate yourself on the matter first. Dilitants are rarely appreciated and they spread unnecessary hysteria.
It's also helpful to break down cultural barriers when making friends with people of different cultures. I for one am grateful that I was able to make friends with people come from completely different religions and cultures to mine; they are great people to know and like once you break the ice. If you want to integrate into a society, you need to learn how to be part of it.
The other thing is that you can often make comparisons and think critically about your own religion and reflect on your own ideas. It's very difficult to grow if you seclude yourself and not expose yourself to other ideas and faiths, even if you're an atheist.
I also am a believer (no pun intended) that should you wish to join a religion, you should understand the religion prior to committing yourself to it. In a society of free will and free speech, it's important that you know and choose what you want to get yourself into as opposed to being indoctrinated through peer pressure, family influences, or just because it's the only thing that you know. It's also important, in my opinion, that religion should be considered in context and not something that you coerce people into following or doing just because you belong to a particular faith; it's something someone believes in, follow the principles of, and it's to be respected - not something that should be used to justify wars or heinous actions against others.
They say that religion is the source of all wars and evils in the world. I don't agree with this. Religion in more cases than not from what I have observed is often used as a justification for certain actions (and hence I consider a type of perversion of the religion) and less so as the cause. I would say the averse actions are more down to the individuals' decisions and choices than the religion that they follow. Some parts of certain religions have certain practices that go against many societies' norms and principles, but that's down to the individual to whether they should emphasise on them or not as opposed to take a strict/fundamentalist/extremist approach/interpretation. I don't think religion is something that should dictate everything in your life, but that's just me.
Having said all of the above, not once has RE been a subject that I have wanted to pursue studying after Key Stage 3, and it's definitely not a subject that I really wanted to be examined on. Yes, basic RE should be included in the education curriculum, but unless it's a subject you're passionate enough about to pursue further study in it should not be made mandatory at all after Key Stage 3. It's also not a required subject for GCSE RE, A Level RE, or even an RE related subject at degree level.
At best, it should be included as something related to social studies (or something similar regarding the awareness of various topics and issues in society, but not something that should require you be examined on). I personally don't take it seriously as a subject other than being something I should be aware of. On the other hand, more serious topics such as personal finance, literacy skills, statistics and basic numeracy, IT skills, people skills, etc. are topics that I think should be examined, would be regularly used (during and after people leave school), and take precedence over subjects like RE, history, art, and music (subjects that are nice to go into, but shouldn't be mandatory or taken seriously unless you really want a career in them); precedence on knowledge that you need for survival and thrive in society over knowledge and skills that make you more sophisticated as a person.
Just to be clear - I do have copies of various religious books on my bookshelf, but I have them on there because I am interested in knowing more about them and not because I am required to have them. Not making RE mandatory doesn't mean people won't go out of their own way to learn more about the subject outside of school.