Interlaced is good for action type footage, or things where catching the action is more important that the look. It allows for crisp movement since TVs can't really refresh progressive frames fast enough.

Should I shoot in interlaced or progressive?

Interlaced made for a better quality look to television broadcasts. As the half images of interlaced are processed quicker than a progressive capture, there is less time for the subject to move within the capture time and so the movement can be crisper and cleaner.

Why is interlaced video still used?

The interlaced signal contains two fields of a video frame captured consecutively. This enhances motion perception to the viewer, and reduces flicker by taking advantage of the phi phenomenon.