It's not particularly unusual, although it's not something that occurs in every company (or even, really, the majority).
It's not something I'm entirely happy with personally, either, but I have taken them both as part of the application process and shortly after being hired and have never noticed any adverse influences from it. Maybe because they're not used negatively, or perhaps because of my winning personality and superb sense of humour. Shut up. I also found the results were approximately accurate, although there were areas I disagreed with.
My boss explained his use of them as being due to the following: he found that an analysis of your personality and behaviours can be a good indicator of how well you will fit into the team. Not how good you are, or how bad: it's a subjective analysis, there is no good and bad, but how well you will fit with the company style and ethos, the personalities of those who are already engaged with the company, and the clients. This is the aspect which may be used as part of the hiring process.
The other side of things can be more beneficial: a personality test can give an indication of how to manage you. Not just how to get the best out of you, but also how to best approach situations with you to reduce conflict, improve your motivation and job satisfaction etc. This is generally a good thing - as it allows your boss to tread more carefully in areas which may be more likely to bother you, or target techniques which are more likely to increase your happiness.
And as the final use, they may be used alongside competency questions (which focus mainly on experience) and skills list (i.e. your own claims) to build a full picture of who they're hiring.
Overall, they're not usually used negatively, they're just one tool which employers can use to differentiate between candidates. Although it can sound like a bad thing to choose people based on personality, remember that you won't be happy if your job is a bad fit for you personally, any more than the company won't be happy if you're a bad fit for their role professionally. The best outcome is that the most suitable person is chosen.