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Starting pitchers are much more valuable than any closer.
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I really think it depends on how said closer is used. Theoretically, anyway, a guy who pitches 130 innings in "game" situations a la Willie Hernandez or Dan Quisenberry could very easily be the most valuable pitcher in the league. Granted, the Phillies probably won't pitch Wags 2/3rds that much, but even so 85-90 innings of pitching in close leads and ties with an ERA+ of 200 can potentially be much, much more integral to a team's success than a guy giving you 200 starter's innings of ERA+ 120 ability.
The problem really isn't so much guys like Billy Wagner as it is guys like Kazu Sasaki or Eddie Guardado or Jorge Julio. When you're down to 60 IP in an entire season and yet you still manage to accrue 30 saves, that tells me that virtually the only time you come into games is in the 9th with your team up by 1-3 runs, which is actually one of the least useful situations to bring a closer in. Maybe some guys (Kazu, for example) can't pitch more than that without risking arm troubles, but they don't deserve big bucks, either.
Anyway, one positive thing I've noticed: there appear to be more and more closers pitching 80+ innings nowadays. Maybe moneyball is starting to spread around the league. There's still too many pitching changes, but hopefully in time folks will realize how useless LOOGYs are, too.
John Craven