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My Prius has a 10 gallon fuel tank (measured at 10.2 gallons to full when completely out). It's very convenient to look at the average MPG on the display, and mentally add a zero to the end of it to get total range. If I'm getting 50 MPG, I can go 500 miles on that tank of gas. It's a very precise way to estimate range.
Regarding EPA MPG, I find that number to be quite accurate as an average people can expect. It does well to give a relative comparison between vehicles, except for those times when manufacturers cheat (EPA only tests 10% of models).
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