I've tape traded for over a decade and still do, though not as much as I used too. That's partly due to time constraints, partly due to lack of tape traders and mostly due to not finding much on people's lists these days that I need.
There wouldn't be a tape trader in the world who has a collection as broad and deep as what can be downloaded from the internet. That said, I've never downloaded a thing in my life.
I certainly wouldn't say tapes are obsolete these days. They seem to be the new 'cult format' for releasing dodgy black metal recordings, though I guess they always have been to a point. And there continues to be a multitude of bands (mine included) who release demos on tape rather than CD.
By the way, Noisenik, feel free to send me an email at email@example.com
if you're interested in tape trading.