Most lists of the positive benefits of W3C validating your website HTML claim that it helps your site to rank better. They also usually claim validation makes a site more likely to work cross-browser/cross-platform.

Now, Google's Matt Cutts has restated that W3C validation is not taken into account in Google ranking, and that one reason why Google.com doesn't itself validate is that it would make it less compatible with some obscure browsers/platforms...
http://www.seroundtable.com/archives/020778.html
(earlier article where he mentioned the ranking question here)

Here's an article containing a list of major websites which fail validation...
http://www.codinghorror.com/blog/archives/001234.html