The reason you couldnt make out anything from the packets is that they probably didnt contain plain text so you could have been looking at any type of data.

Sniffers can help a hacker find out usernames and passwords travelling across the network if he can recognize it in the packet. They can also help with session hijacking (wont go into that)

From what i know the only info a packet sniffer can give you about the packets it recieves deals with the packets and not the data within.

Hope this helped a bit