I have the Moto360. I use it a LOT via voice, and especially so while driving. The voice recognition tends to work at better than expected rates.
In crowded settings, or sitting still, I will almost always just grab my phone before having to worry about whether or not the environment is too loud, which is (I suspect) why you probably see so few people using it.
Do you use it to text when you're surrounded by other people? The biggest drawback for me is not how noisy the environment is, it's that I literally tell other people around all that I'm doing with my phone. And as a fellow bus rider, for instance, that would annoy me to hear your text to your wife. But I found out that nobody actually does that.
As a general rule, no, unless I'm doing so to make a point / be heard. For example, I'll often verbally take a note of book recommendations that people give me, both to preserve the note for myself (as book recommendations are serious business) and to affirm to them that I am taking their recommendation seriously without having to explain that I am taking their recommendation seriously.
Beyond that, I agree that verbal commands on a bus would be inconsiderate both to the other passengers as well as the recipient of the message, whose privacy I just (slightly) violated. That said, if I'm sitting on a bus, I don't really have a good excuse for not typing the message myself, and typing is still slightly preferred except for when my hands are occupied or my phone is not conveniently accessible.
In crowded settings, or sitting still, I will almost always just grab my phone before having to worry about whether or not the environment is too loud, which is (I suspect) why you probably see so few people using it.