Learning and memorizing all of the notes on a fretboard is a large undertaking. In fact, most veteran players who do in fact know all of the notes acquired that knowledge through years of practice, not by hours of rote memorization. The dots' positions on the fretboard are like mile markers on an interstate; they're placed at intervals to give you an idea of where you are in regard to what note you're playing. For example, the first dot is at the third fret and at every second fret after that, each dot usually indicates a full step on the scale.
Even the most seasoned guitarists use the dots from time to time as a point of reference. In addition to using them to figure out what note you're playing, the dots are also helpful when you're playing a pattern and not necessarily thinking of the actual notes themselves. This is especially true when playing solos or high notes, as the location on the fretboard for the notes are high on the fretboard's neck, where the frets are closer together.
There are also dots on the fretboard's side, which are easily viewed by the player, that correspond to the dotted frets on the fretboard. For those who regularly perform, these dots are visible in dark, ambient venues. In such places, you may not always have a clear view of the fretboard itself, but unless you are playing in a pitch black setting, you can usually spot them on the side of the board. Also, if you also sing and can't look down at your guitar that often, you can see the dots out of the corner of your eye.
Learning theory in a book or classroom setting is quite an undertaking, albeit necessary if you wish to gain advanced knowledge of notes and scales. However, the dots on the fretboard are functional in that they give you a hands on and visual approach to grasping a theoretical concept. For example, if you're having trouble learning about what a fifth is, simply play the third dot on the sixth string, G. Then, with your free ring finger, play the fifth dot on the next string down, D. You've now played and heard a fifth.