How to profile memory usage & performance with Instruments?

Of all the Instruments Trace Templates, I love using:

• Zombies to detect where an object is getting over-released, great for debugging EXEC_BAD_ACCESS errors.
• Leaks to detect memory leaks.
• Core Animation w Color Blended Layers to detect frame rate & translucent subviews, great for smoothing up UITableView scrolling.

I always hear people saying to profile my app's memory usage & performance.

1. Why should I profile memory usage & performance? My app runs fine.
2. How do I do it?

I've used Allocations and see that my iPhone app starts at 1 MB total allocated memory and grows to 5 MB after normal usage. What is too high amount of memory usage on the iPhone? iPad? Mac?