[kbenson]

It depends on how you interpret "floating point error". If by that you mean the error the error inherent in the representation, it actually increases that through loss of precision, as you note. If you interpret it as "problems caused by lack of precision in floating point" (i.e. the patriot missile problem references in the article is a "floating point error"), then the tracking of precision will allow you to easily know when you've hit an error threshold that is unacceptable, allowing you to avoid those problems.