Why would you want to "delete" a game from your library? You can remove the local content any time you want. Then all you have is a listing showing you own the rights to install again at a later date.
Because I don't play multiplayer games. I currently have like six Red Orchestra-related game icons in my library. Only one of them is the single-player game. It's a real pain in the ass to find the right "game" to launch.
In addition, there are some games that I have finished that I know I will never touch again (Overlord, Bastion, Half Life ....to name a few). I don't want them cluttering up my library.
In addition, Humble Bundles often come with games that just....aren't for me. I got a Humble Bundle for Costume Quest. It came with Stacking. Stacking is......stupid in my opinion. But I get to look at the Stacking Icon every time I look at my library because Steam won't let me delete it......