How important are circular lists/recursive objects?

[Brian Hurt <bhurt@spnz.org>]

In Ocaml you have some ability to define recursive data structures.  The 
classic example of this is the circular list:

let rec example = 1 :: 2 :: example;;

There are obvious limitations to this sort of trick:

# let rec example = List.map (fun x -> x + 1) (1 :: 2 :: example);;
This kind of expression is not allowed as right-hand side of `let rec'
#

The question is: if this behavior was completely outlawed, and either you 
couldn't build up circular lists/recursive data structures of this type at 
all, or had to call special functions (List.circularize, say), to create 
them, would this be a signifigant problem?  Does anyone actually use this 
construct, and if so, for what?

Brian