Wrong. If set up correctly, the electronic aids can make you much faster. TCS stops all wheelspin, but keep it low enough to stop understeer. ASM to prevent Understeer, i used to set this at 15, and it meant i could go around corners fast with no skill. But eventually i got past all that, i now use manual gears and turn all aids off, but i still can't beat my 'Ring laptime in the 88cv that i made around 3 years ago...
With good skill and consistency i think aids off would be better, but we don't know for sure, i don't think anyone has done in depth experiments with different driving aid setups. My example is probably just a one-off.
EDIT:
You are right in saying most people don't use them At least anyone whos serious about the game, instead of those who just pick up and play and don't bother completing the game.
In general, you're wrong. You only have to look at the exceptionally competitive world of racing competitions in GT4, such as the inter-forum Board Challenge or the Weekly Race Series, to find that top drivers essentially never use aids. Believe me when I say that competitors in those series are doing whatever they can to go faster, and are not keeping aids off out of principle. In certain rare circumstances, such as when a car has bad wheelspin, a TCS setting of 1 (but never more) does give an advantage. Also, extremely rarely, an ASM Understeer setting of 1 allows certain cars to be driven with more precision and speed. However, in Arcade Mode, having no driving aids is always fastest, because the levels of TCS are non-adjustable and are set too high to be useful. In general, avoiding wheelspin is largely achieved by selecting a much higher gear than is "recommended," rather than by activating the traction control. It's true, though, that for more casual players, having aids on can be faster in powerful and/or ill-handling cars.
I apologize for the off-topic post, but I couldn't help but refute that statement.