Both.

Sometimes its just fun to stealth up and kill multiple mobs before they even know your there. I've killed packs of three deer without them spooking which is more efficient than trying to plink them with a bow after they spook when the first one gets hit.

Othertimes its simply damage and time saving. Sure i have to spend a few seconds to sneak up on a troll or a seeker soldier but it also means its going to die in one, maybe two, hits rather than turning into an actual fight. Its dead before it even knows it was under attack.

Plus i think people who don't fight with daggers/knives frequently don't understand the speed/stagger rate on them. Knives are one of the best weapons in the game and are often overlooked because people just look at the damage numbers and on the weapon info and see something lower than other weapons. My default weapon unless i hit a circumstance that favors another weapon is almost always a dagger. I spent hundreds of hours in this game ignoring daggers out of ignorance and felt like an idiot once i started using them and realized what i'd missed.