The first game I remember noticing this on was Skies of Arcadia, during boss fights. Mostly I remember thinking "wow, that's neat," until I got into a fight where my party was constantly going from full strength to the brink of death. At that point the music kept going back and forth and I started thinking "man, that's annoying."
So I'd say that I'm all for subtle manipulations of the music caused by what's going on in game, but make help immersion rather than feel like a gimmick.