True, a common plan B if the wizard doesn't have HP prepped.
Not that hard to imagine a gem, is it? Or a coin? So cast Locate Object in mid-dungeon and find out where the treasure is. Get split up from one of your companions? Cast Locate Object on her shield, it'll at least tell you whether she's close or not. Not sure where the vampire went on going gaseous? Cast Locate Object and look for coffins - they're pretty easy to imagine. Best one I've seen: party can't find a secret door for the life of 'em until someone cast Locate Object and looked for hinges...
Need I go on?
No, I get it now... you are ruling on how the spell works in a way that is vastly more generous than I would.
"Not that hard to imagine a gem, is it? Or a coin?" - Sure, but since I've never seen a party that didn't have at least one gem or coin on their person, this would invariably only detect an item already owned by the party. Also gem is far too general for my taste. Jade I would accept. Opal I would accept. Diamond I would accept. Pearl I would accept. Gem doesn't mean anything that can be pictured - it's a disparate class of things united only by value. "Crystal" might detect a lot of different precious stones because at least that's something you can picture, but would miss pearl, opal, or jade. More on that later when you start talking hinges.
"Get split up from one of your companions? Cast Locate Object on her shield, it'll at least tell you whether she's close or not." - That would actually work and is pretty cool - and I'll keep that one in mind - but if communications with your companions is the goal there are better spells for arranging that.
"Cast Locate Object and look for coffins - they're pretty easy to imagine." - That would probably work as I would accept that most coffins are close enough to the general mental image of a coffin that the spell should work, although I can imagine a DM ruling more strictly than that. However, it would be a rare vampire that had only one coffin, and that there was not a nearby graveyard of some sort potentially messing it all up. For example, casting this in Castle Ravenloft would be futile, as not only are there numerous coffins and an entire crypt level filled with them, but merely knowing the direction toward a coffin wouldn't in the slightest tell you how to get there. Are you ruling that it works like "Find the Path"?
"Best one I've seen: party can't find a secret door for the life of 'em until someone cast Locate Object and looked for hinges" - For me, this starts to get problematic. The big restriction on the spell is one that is open to interpretation: "if the image is not close enough to the actual object, the spell fails". I can see from the wording a lot of different ways to go with that depending on how you interpret "general", "specific" and "unique". If you want to find a the hinges of a particular door, to me you have to have a mental image that matches the hinges of that door. At the very least, you'll need to guess what the hinge is made of and how it is constructed. For example, I'm guessing when you imagine a hinge right now, it looks something like a modern door hinge. Trouble is, that very likely any secret door in my game is going to be constructed with a post hinge running the length of the door and fitted into brass sockets that support the door at the top and bottom of the frame, which is not at all what you are picturing and so far from what you are picturing that I'd rule the spell wouldn't detect it as matching your mental image even in a general sense. The secret door literally doesn't have hinges like you imagine. If you picture in your head anything that looks like a modern door hinge, you'll very likely get the nearest hinges for something that isn't a secret door or very likely a chest.* And even if you did picture the right sort of secret door, you'd still only know where to search for it, and not how to open it and in any event picturing hinges requires you to know that there is a secret door here in the first place. If your goal is to find secret doors, "Detect Secret Doors" is vastly more powerful in every respect, including the fact that it can detect the latch/trigger mechanism for the door. If you can't do that unaided, merely knowing where the door is doesn't help you, and pretty much this sounds like a DM ruling generously just to get the party unstuck and the game moving again.
In short, your used to adjudication on this spell that allows it to substitute as a general spell for several much more specific spells, whereas what I would expect of a DM is to read this and decide that it in fact is a specific spell with a specific purpose - locating objects that look very much like something that the player can clearly describe.
*UPDATE: Actually, thinking about it more, you'd most likely detect the latching mechanism on your own travelling spellbook or scroll case, both of which would have a hinge. There are any number of hinge-y things in a typical party's possessions.