The Fitbit also measures elevation. If you climb a set of stairs or a steep hill, not only is that measured as steps taken, it's also measured in height. The Fitbit has a reading called stairs. Depending on how many high you climb in a day, you might get a motivational message that says,"congratulations, you just climbed to the top of Big Ben" or something along those lines. I never really pay attention to my messages. eh-hem.
Yes, the fitbit will periodically show motivational messages congratulating you on how many steps you've taken, how high you've climbed, etc.
The Fitbit is pricey at $99, but that's because of the technology. The technology that allows the Fitbit to do all the things it does is why the price is so expensive.
Do you need one to be fit ? If you already have a pedometer, you don't need the Fitbit. The Fitbit (like a gym membership or pedometer) is a tool you could use to help you be a bit fitter.
What you get out of it really depends on how much use you get out of it.