The most expensive tshirt I own is branded. It's a Metallica tshirt.
When it comes to a lot of branding, some of it's free (there are like three or four Glock hats floating around here and nobody paid for them) and other times it's like Dogmush said. If you like the brand and need a hat, why not? The vast majority of those items often are not more than a dollar or two more expensive than something without a brand name on it.
Hell, I need new sweatshirts and jackets and I'm going to spend $40 to order one from Springfield armory, because the honest truth is, for a sweatshirt like that, I'd pay close to the same amount at Old Navy and just not like it as much. *shrug*
It's only when you get to certain brands that the price gets stupid that I question people's wisdom (Carhart comes to mind. I looked at some of their heavier sweatshirts the other day and ended up buying what I'm guessing was the store brand version. I'll keep buying their socks and if I have the cash at some point, I'll be getting one of their good farm coats, but not a sweatshirt I can get cheaper) and that's only because someone is buying it. Maybe they want to look "cool" and fit it with their friends. Maybe they just like the brand too the point that they don't care. Maybe they just have money to blow.
And I don't see it as any different than buying a tshirt with the name of a band on it.
Style is style. Most of the time, it doesn't make that much sense. Some people get really wrapped up in it, others don't.
Personally, I think those Louis Vatton bags are ugly as crap. I'll stick with the Vera Bradly bag that my mom got me years ago when it was the it thing, because I'm one of those people that would rather have something I think is pretty than a brand name. If it happens to be both, well, it's still pretty.