All they really do is provide a hardware handshake that some embedded portion of software looks for before it continues to run. Depending on how its implemented, the software could look once (upon program start) and then leave the program unencumbered, or it can continually monitor for compliant hardware, which would then continually steal CPU time, which for an audio recording program can be a bad thing. Also, they are subject to being damaged.
I agree with you, tho. I've had issues with both serial and USB dongles over the years (both cases were color management software). Maybe they've improved reliability in recent years, but I think they are a lousy way to keep legitimate users "honest". The pirates are never going to buy anyway. They'll use a cracked version they downloaded off some website, even if it doesn't work right.