So therein lies my question. Why would you need another slider for this sound under the settings? That seems unnecessary to me
I think the official answer is for media applications that lack such controls onscreen such as games.
Personally at first as a switcher I HATED the many volumes of Android(CM7) on my Nook Color. The buttons on the home screen would turn down the "ringer volume" (useless on Nook). Only way I could turn down the "media volume" was to start some media and immediately rock the rocker down, which meant I had to preplan if I wanted to play a game in class.
Even worse there seemed to be another "notification volume" or something because even when the other two were turned down notification sounds would get through (an issue that got the poor Nook banned from one class). I ended up having to go into the DSP manager and just basically turn off the speaker to be safe in class. Luckily the default ROM of my SGS2 has a "Silence" option on its power menu, so I can easily make the device ready for class (I hope). The thought of losing this option will probably keep me off CM7 for a while.
I must admit I still don't get the point for the different volumes. In my experience I am either in a situation where I can have sound, or I am not. I am never in a situation where the music from my game is a no-go but no one cares if the ringer gets through if someone calls.
With all of that said, I think the iPhone relies too much on its Mute Switch to silence the phone. Mine broke on my 3GS a year and two weeks in and I couldn't find any other way or app (jailbroken or not) to easily silence the phone. Even the volume rocker would only go to very low- not silent. I ended up just leaving my phone in my car when I went to class which was a huge pain. That Mute Switch, a locked bluetooth stack, the fact that each new generation would leave a pile of my (expensive) iChargers in the dust, and the lack of hope of having a bigger than 4 inch screen is why I moved on.