CSS Sprites are fantastic. Visit http://www.thedailyspunkmeyer.com and you’ll see that all my images are css sprites. While larger images seem like they take longer to load than smaller images, they don’t really. The fact that all the smaller images are loading separately tricks the eye into thinking they all load faster. Try this, create a css sprite (I assume you know how you do this) for a couple images and then run a speed report at http://www.websiteoptimization.com/services/analyze/ Focus on the speed for 56k /ISDN 128k especially. Cable speeds won’t really give you a good indication whether you’ve done anything.
If you’ve notice a speed increase using sprites, then use them. Also, less HTTP requests means the site needs less external files to render and things will load faster.