Mandalay Bay is one of the best hotels I've stayed at in Las Vegas. Although they now charge for parking, this pass allows you to park at any MGM property on the strip, a nice feature considering that the Mandalay Bay is all the way at the south end.
The rooms were comfortable and fairly spacious. It's not the biggest room I've had in Vegas, but it was definitely fine for the people who stayed in the room. The tub was quite roomy and very nice.
The hotel itself has a wide variety of restaurants and attractions to choose from, and I find that it is generally less smoky than a lot of other hotels on the strip. This fact alone justifies its more remote location.
If you feel like walking, you can easily walk through the Luxor to Excalibur. You can also take a tram to Excalibur that is very quick. This definitely shortens the perceived remoteness of Mandalay Bay from the rest of the strip, as you're able to get to the rest of it fairly quickly.
Many people choose Mandalay Bay because of the multiple pool options. Be warned that they close these in the winter and early spring times. They still have a pool open, but it's nowhere near as big.
I will definitely be returning to Mandalay Bay the next time I'm in Vegas.