The pads distribute the force of impact over a wider area. In effect, less damage to that specific part of the body, or could stop a puncture/ laceration. Certainly it would help on elbow or knee where there is no mussel tissue covering bone.
I've been down twice, and both times when I hit the ground I was going less than twenty-five MPH. Both times I didn't have protection on. In fact there wasn't any available back then other than leather and now I don't ride without as much as I can stand to put on. This summer I'll be getting a vented jacket just so I can have something to hold those little pads in place.
PS Even if you ride naked where gloves and boots. Who cares what it looks like, it's your body and you have to live in it when the event is over
