URL shortners, undoing DNS

I am by no means an expert in DNS or the like, but as my colleague (Mike) and I were discussing, the premise of DNS was to turn IP Addresses of servers, which are humanly unreadable (just numbers) into URLs that are readable and understandable by humans (i.e www.amazon.com).

Now, as if someone has made a great discovery, URL shortners have become popular (I am guessing Twitter made them popular?)..

Facebook have one, Twitter have one, as do Amazon and Google.

I don't want to just rant, but why so popular? Why not just have a system where a User can input 'Link Text' to resolve character restrictions?

Instead of them actually helping me as a User, they hinder me, I am now open to phishing - or more realistically, wasting my time going to a URL that I would have previously not bothered to navigate to!

i.e Check out this awesome link: http://bit.ly/aNVFpF

Stop turning a perfectly usable and good system (DNS) into its previous incarnation!

Tinyurl and alike may as well have turned www.amazon.com into 72.21.210.250 !!!!!