Thought is was useless then, now that I'm well out of school and attending a gym I look back and...I still think it's useless.
Gym classes spawn locker room intimidation and uncomfortable exposition, kids and early teenagers can be really horrible at this kind of stuff because of their immaturity. It harvests problems with self-esteem that may or may not go away depending on the character.
Other than that, it's usually a fit teacher that thinks he's in an army or something to punish someone with push-ups. My math teacher never punished me with 20 equations, so what right does this person have to do it? Also, many of these fit teachers don't know what it's like to have extra weight and run for 10 minutes while your ribcage hurts from trying to gasp for as much air as possible.
Finally, sports. I hate sports with a passion. I don't mind physical exercise but I don't like the competitive aspect and the fact that too often students take the game to seriously. Also, being the last to be picked up for the team doesn't feel to good either.
Gym classes are pointless and only serve to bring down the average grade in otherwise excellent students, and raise it in some meatheads. Let people decide whether they want physical activity or not, I mean you don't put retarded children learning physics (it's a bad analogy but go with it). I am opposed to Gym being mandatory, and I would hate if sex education became too, it's stuff that should be a personal decision and self-maintained.
I lost more weight when I learned about food and changed my diet than I ever did in school. A nutrition class would be FAR more useful and less degrading than physical education.
Here's an idea to partially reinvent PE:
Have a personalized training for everybody, you are 20Kg overweight, if you lose 10kg you get an A or a B, if you don't you get a C (NEVER NEGATIVE SCORES), and you do the exercises you want and the teachers sees as fit for your condition. It wouldn't solve the locker room intimidation but it would help a lot with the rest.