Yeah, in quite a few cases (especially a particular generation of console games in which motion blur can't be disabled) it is covering for something. Some effects like TAA work great if the camera doesn't whip around quickly, but can leave some "ghosting" if the camera moves too fast. So motion blur makes the ghosting less visible. Film grain is another one that is sometimes used to hide noise in dynamic light reflections and the like. I'm of the opinion that they look like ass but in some games they do look better than what they're covering up.

Wardogs! Great game