For me, it's because I like crafty things and I've always liked the gratification and challenge of making something myself. Of course, there's also that meditative quality of the actual knitting process. And with our tech savvy society practically controlling everything we do (not that we mind so much), I think some people are drawn to old crafts like knitting and crocheting because of their simplicity and down-to-earthyness. It's also a way for me bond with my friends and yes, these sort of crafts are perfect for obssessive types. Me!
Simba loves The Knit and figureds if you don't like it, it means more for him (because, "Obviously there's something wrong with a human that doesn't like yarn stuffs").
Speaking of old, I know some people are surprised when they learn I knit. They think it's a craft perfected by grandma types only. I usually tell them, "Actually, it's quite popular with young people." I'm not sure if I've convinced anyone but it isn't uncommon for the response to include, "Will you make me ______________ (fill in the blank with a time consuming, expensive ten skein object that I don't know how to make nor do I wish to learn to make for an unappreciative non-knitter type)?"
What about you? Why do you knit or crochet? How do you respond when people say, "My grandma does that."