I have never done it, but is there a situation when it should be used - if so, when?

Sure. If your opponent has one guy who takes a huge portion of their shots (and shoots efficiently), you've got to decide if you've got a single M2M defender who can take him. If not, you have to consider the double-team.

Now, the double-team is a lot more risky if your star opponent also has good BH / PAS, because he can pass out of the DT to guys who'll have open shots.

I use the double team quite often.  Doesn't always work out but I have had good success shutting down my opponents best player.  Usually I use it if my opponent has a great player who is either slow or a poor BH/P.  That is what I look for.   I also rarely double team post players.  Typically guards or SF's.  

also consider it a bit more if you cant think of anything else to do and are likely to lose - heck, it might work....