I've made several threads over the years on this particular subject. It is probably my least favorite device in gaming, period. If you're better than the AI you should win, no questions asked. I don't need you artificially making the game more difficult in order to stretch more "value" or fun out of your game. Maybe design the game in a difficult but fair fashion then?
Evo studios was horrendous about this stuff. Motorstorm was one of my favorite arcade racers of all time. The amount of rubber band AI is ridiculous, particularly in pacific rift. Here's the thing that really drove me nuts. You could finish a race in 3:00 minutes (just a random number for the example) and finish 3rd, however if you rarely boosted throughout the level and played it slow, you could finish with 3:45 minutes and win. The AI would only boost if you boosted, they would only do well if you did well. This is NOT good game design. It seems like they would rather cheat the system and therefore the player, in order to get more play out of their game and make it more "challenging". It wasn't more challenging, it doesn't encourage getting better at the game, instead you have to learn to cheat the game to win.
Another example of motorstorm bullshit. In pacific Rift the expert races towards the end got insanely difficult. One of the staples of motorstorm was the multiple paths you could take. I forget the name of the track, but there was one where you could take the high ground and go over a bridge, or you could go low which would lead to you going off a jump over a ravine. The AI would almost always take the low level to go over the jump. You could see the jump below from the bridge above. If you went over the bridge up top and didn't boost or took it slow, the AI would just crawl their way off the jump and fall into the ravine. Horrible horrible game design, how is that fun for anybody?