In my personal opinion, I too believe that this is a very hard question and actually one of the most important questions you will be asked at an interview. This is actually the first question that I have been asked at when I went to interview at USC and UCSF.
Why do I think this question is so important? It allows you to sell yourself as an individual. You want to give an answer that is unique and original. You want to tell them something about yourself that makes you STAND OUT from the REST of all the applicants. The way I see it, applicants who have been invited to interview all have the stellar gpa, the high pcat score, the extracurriculars, blah blah blah....and if you have all the above as well, talk about something that may separate you from the rest of the crowd.
I very strongly believe that if this question comes at the beginning of the interview (which it usually does), then your answer will very well set the tone for the rest of the interview. It's your chance to shine, make a lasting impression.
Thats just my 2 cents. 😉