1. The drag-and-drop/selection semantics in the URL address bar aren't broken.

Not really sure what this means. Dragging and dropping URLs out to bookmarks? Or something else?

2. I don't have much choice when it's embedded in my RSS reader.

You could e-mail the makers of the software and explain that your are now afraid your computer could be infected automaticially by using their products. The more responses they get like this, the more likely they are to look at switching the core out. The fact that prominent sites are being hacked to get this code out would scare me enough to at least throw an e-mail out.

-Need it to access the Windows Update site.

Valid reason, and the only reason I use IE from time to time. Though I prefer just to use the Windows Update service and allow it to check daily on its own.

Some poorly writen web site features (like roll-over popup menus) will only work in IE. I know it's an authoring issue, but sometimes you need IE to make up for things like this.

Use the webmaster address to make them aware of such issues, and explain why you may not use their site in the future with the security risks of IE. Double the security threat notice to them if they happen to be on IIS. Some web authors are very receptive to feedback like this.

i need it for gmail.com, unfortunately, among other stubborn sites.

GMail works great in Firefox. You may have some luck asking for Opera support as well, since they did add Safari support pretty quickly. Other stubborn sites, see above.

This annoys me. Is there a way to always make my bookmarks visible with FireFox too?

View menu, Sidebar, Bookmarks

A few valid reasons here, but all the same ones in the past. Do these reasons really justify the risk? I know Heather is not to pleased about cleaning up fraud on her credit report right now (from her conversation in IRC), and I don't think I'd be willing to deal with it just for using IE to get to some site.

I do hope people are at least considering running IE only as a last resort. There is even an extension to Firefox to add a "Open in IE" context menu if it becomes necessary. But honestly, feedback to the webmasters is the best way to change things. I personally don't come across IE only pages on my day to day use. My work even has a policy that all internal sites must work in Mozilla 1.1 based browsers and above, along with IE.