Up until 2 years ago I was working at Llanbedr, where almost every aircraft was vectored as non-compass non-gyro. They were UAV's. Of course, it's closed now sadly, so there's probably less reason to do it. I believe it is still taught as part of the emergencies and unusual circumstances syllabus in the Approach Control Surveillance rating.
Also used it a lot when I worked at Farnborough, where we dealt with Odiham helicopters who had no imagination, so every time they did a practice speechless, they also simulated a compass failure!
It's actually very easy to do, and you can be surprisingly accurate if you do it regularly. To give you an idea, the UAV's at Llanbedr were given no-compass no-gyro PAR's! That was fun!