Question in title
Tower shields are best used by somebody who can reduce the negative side of this. This can be through things like the convertible tower shield that is a large shield most of the time and switches to a tower when needed. It can also be through the tower shield specialist fighter that get many class features that reduce the penalties for using a tower shield.
I have a familiar who uses one. It's heavy, but he loses nothing by carrying it around most of the time and can strap it on for cover when he doesn't need to make checks or attacks.
A character who can't meaningfully engage in combat due to immunities can take the standard to be in position to flank while also being under cover. If you need to close a bottle neck against things then the tower shield is great.
Having full cover means not provoking attacks of opportunity, so taking the cover action, applying it to the front of your square, then moving through a threatened area will allow you to avoid those AoO.
There aren't rules regarding this one way or the other, but you could set the covered area to "up" forcing flying creatures to the ground if they want to attack you. Likewise, a flying creature could set it to down. Again, no real ruling on 3d space and tower shields that I know of.
It's situational certainly, but it's a piece of equipment that's major point of interest doesn't require proficiency only encumberance. I recommend buying one whenever you play a character strong enough to carry one and seeing if you can find a use for it.
I've been enjoying my mythic guardian 5 phalanx soldier 12 character in Wrath of the Righteous.
I didn't bother to start using a tower shield until I only had a -1 to hit, but I really like now that I can give all my allies a +2 to AC with a move action.
But I also use mythic vital strike to usually only attack with a standard action.