I seem to recall a particularly nasty question coming up at some point in the ATPL studies. It was something along the lines of this:
The elevation of the ground is (x), and the aircraft is flying over a mast, heigh (y) above the ground. The local QNH is (q), and the temperature is (t). The aircraft is flying IFR, on a magnetic track of (m), with a variation of (v), and (d) degrees of left drift. What is the lowest flight level the aircraft can use?
Answering the question requires you to first of all realise that you must be 1000' above the mast if you are IFR. Then, you have to take the temperature to find the indicated altitude at which you must be. After that, you use the difference between the QNH and the standard pressure setting to establish the flight level equivalent to the lowest possible altitude. You then need to know the quadrant rule (you can guarantee that including/excluding the drift and variation will put you into different quadrants, so you need to know which to include) to establish the lowest flight level in the correct quadrant. Unfortunately, I can't find the question, and I can't be bothered to work out the numbers to use to make the question appropriately difficult!
FFF
---------------
Edit to answer In Altisimus's question: there is no need. It only affects you at altitude, it makes no difference on the ground. And the further away from the ground you get, the less relevant your exact physical height becomes.
The only people who actually care about this are some people who operate IFR in arctic conditions. In these cases, instrument approach minima need to be adjusted (before flight) to account for the difference. There was a thread about this a while ago, but bu66ered if I can remember where it was or what it was called!