In my work as a curriculum director, I have had to study the current theory behind foreign language instruction. I even led a team that created an award winning online foreign language instruction system that is now used throughout the U.S. and some other countries. (No, you can't useit--it is part of an online school curriculum.)
The way it was typically taught in schools for centuries, the way Dirty-Dog was probably taught in school, was later shown to be about the worst way you can teach it. (And yes, much of that research came from the military.) Several people have mentioned the positive aspects of immersion, and that is a key part of the current thinking on foreign language instruction. Yes, living next to Madrid will teach you a language far faster and more effectively than the way I was taught decades ago. Watching Spanish language TV will do a lot for you.
I am by no means truly familiar with Rosetta Stone, but it is my understanding that its foundational theory is consistent with current thinking on foreign language instruction. I would expect that it would do as good a job as you can expect from such a system. If I were in the position where such learning might be useful to me, I would probably go that route myself.
I am sure you will find critics who were taught the old way and fiercely believe it to be the best. When we built our course design teams, we had several early hires who could not get rid of the old system (memorize grammar rules first) in their thinking, and we had to fire them. In addition, we had people who reviewed our program and gave it poor marks because it was not traditional in approach. If you find someone who criticizes RS, ask some questions to find out why. If it is because students are not focusing on verb conjugations and vocabulary lists from the start, then you will know where they are coming from.