In theory, a service like PSA should be useful as a neutral third party that makes an unbiased appraisal of a card that both a buyer and seller can agree on. In reality, they are absolutely a scam and provide almost nothing of value. You could determine the condition of a card yourself using just a magnifying glass and five minutes of your time. For whatever reason, they've convinced enough people that a professional grade is necessary for buying/selling cards.

You are correct that their grades are subjective. I've heard of people who will send the same card back multiple times to try to get a better grade, which can be worth it for very high-value cards.