All our local schools do it - in fact dd's even getting one for her playgroup! My mum (prim school teacher) has been doing them for years. As I understand it, they are now established 'best practice'
Theory goes:
- child gets a chance to meet teacher in his/her own territory - ie in position of relative power
- parents get the chance to talk about any concerns in a non-threatening environment
Although my mum said it was also a useful way to get a sense of what the child's household back ground was like. Not nec in a judgy-judgy way (my mum is the least tidy person you could meet - I'm sure lots of mums cleaned up for her & she never noticed) but ito knowing that - child A had 5 siblings and the world's most organised mother = would never forget PE kit, child B had a brilliant garden, & his parents who could probably be roped into helping out with the school garden etc