One reason why they are poorly used (aside from the primary one - no one designs databases anymore, folks just throw a bunch of tables together) is that, for anyone working at the level that requires real modeling work, MS's feature is too restrictive.

I don't want to use one tool for SQL Server, another for ASE, and another for Oracle; to my firm, it's all 'the database'.

It may be better now, but also MS tends to limit choices of representation in tools like this, and then drop support as they run to the next marketing term. The best example is the (former) support for database modeling in Visio: MS would let you download modules to do this in the previous release, but they don't work in the newest Visio, and they have no plans to make it work.

That's why, to get serious about modelling and documentation in a non-trivial environment, you're out there looking at third party products.