Ok, I get your point, though it's a lot more complex than that when talking LCD's as it doesn't refer to how fast it repaints a full frame, but an individual pixel. A 60hz display doesn't limit your game to 60FPS max. Nor does using a 120hz LCD mean you will get higher framerates. It does mean your LCD may not be fast enough to display every change in that one second time frame.
The difference is, the vast majority of people can't notice any difference at speeds over 60hz. As an example, an incandescent lightbulb is cycling at a rate of 60hz. If your eyes are sensitive enough to sense that in a light bulb, then there is no doubt you'll have a better experience with a 120hz panel. I know in my experience, I see no gameplay difference between 60hz and 120hz. I do, however, see a massive difference in Image Quality, Viewing Angle, and Color on an IPS panel over a TN (120hz or otherwise), and anyone looking at these two monitors side by side can clearly see the differences.
Of course I wasn't getting 120FPS, but according to FRAPS, playing a single player mission averages about 80FPS for me. Yet, I saw no differences in game play, performance, ghosting, taring, etc.
Given I am running an i7 with a 580GTX video board, If I am getting far less than 120FPS for a game that is 17 months old, I seriously doubt anyone with a system of lower specs will get anywhere near 120FPS on anything released in the past couple years, and certainly not anything coming out in the future.
The end result is still the same. I, personally, can't physically see any benefit to running Bad Company 2 on my 120hz over my IPS panel. I'm not talking about what I should be experiencing because of theoretical optimal refresh rates vs FPS, but what I, personally, can observe on my actual hardware. Someone else may experience something else, but I expect that even for the most "eagle eyed" person out there, the difference would be extremely subtle.
Ultimately my point is:
If you're going to spend $300+ on a LCD display and you aren't going to play 3D, you can a 120hz monitor and have a great gaming experience but inferior usage for every other task.
Or:
If you aren't going to use 3D, you can get an IPS panel for the same money, get gaming performance that is no difference for the vast majority of people, and a superior experience for daily desktop use, Movie playback, and any other computer use.
As I said, I will never go back to a TN panel and plan to ditch my Acer 120hz for a second IPS panel as soon as I can afford it. Now, I would LOVE to see a 120hz IPS panel one day, but until that day....