Blog Commenting is huge for low to moderate competitive terms. In my experience I have many wedding photographers that rank only as a result of followed comment links.
In fact I know a group that have set up a system for announcing when they have posted something new, and the other members will go post a comment. It's a requirement to have No-Follow disabled.
The people posting get a link back to their site (it's obviously not a great link, but it's a link. It also isn't keyword targeted - too spammy for most site owners).
The site owners get lots of comments and their clients get to see that the photographer is popular and see great comments about themselves.
ETA: Sorry, I saw you were talking about No-Follow. Yes, there is some speculation that No-Follow is still passing some juice along.
And it's also important to note that No-Follow isn't No-Index.
That means that Google can still crawl through the links that are No-Followed. The No-Follow is just to say that you don't "vote" for the site.