We have tested this. It doesn't appear to do anything directly to improve rankings. hCards and microformats give you more control over how your web pages appear in Google search results. It can enhance the results by displaying star ratings, the number of customer reviews, etc., which makes your page stand out in search results, but we have seen no evidence that it improves rank positions.
If you are using geographic coordinates in the microformats, it theoretically will help Google to localize your business and place it accurately on Google Maps. That also means that your site should show up more often with a local search, such as "pizza parlor in New York'. In this situation, you could say that it improves your rankings, but does not do so if the site is already properly localized.
I know that there are people who claim that you will get better rankings if you pay them $500 to add microformats and hCards to your web site. From what I can see, this is just hype.
We do see a number of sites that fake star ratings and the number of customer reviews using microformats. Thus far, they have been doing this successfully, but I think Google will clean that up at some time in the future by requiring some type of evidence that the reviews and ratings actually exist.
"Democracy is two wolves and a lamb voting on what to have for lunch. Liberty is a well-armed lamb contesting the vote." -- Benjamin Franklin