For us, "off-site" just means a full company meeting that includes beer and a more fun atmosphere.

We use it for brainstorming and strategizing, not because it's impossible to do at work, but because a change of scenery and a measure of relaxation is a healthy change of pace which might jostle out new ideas.

Of course that's not the sort of "off-site" you meant; in fact we use the word as tongue-in-cheek.

I like the point that the presence of the "off-site" might indicate problems at the office, and that too often the "strategizing" that occurs there, stays there, indicating it wasn't a good use of time.