Almost all my solutions to various maze-like perlgolf competitions have been recursive. For example, the rush-hour problem, where given a state of cars on a 'road', move them around until you can get a particular car out of the jam.

sub g{my($b,$r)=@_;$s{$b}++||map{$p='.'x8x/[A-Z]/;$s||=$r x$b=~/$c
/||g($n=$b,"$r$c ".($n=~s/$_(($p$c)+$p)(?!$_)($c| )/$3$1$_/s-2*/ /).$/
+)for$",$c=$_}$b=~/\w/g;$s}$_=g$_
[download]

Look here for the rules, and links to the other solutions.

I can't think of a way to solve this sort of thing iteratively, unless you're willing/planning to take forever. And I think the solutions for that problem illustrate the terseness available to recursion to solve quite an awkward problem. (my solution was 170-odd characters - the winning solution under 140!). And my 500MHz machine still solved the problems in a reasonable length of time.

Also, isn't the regular expression engine recursive?