It can be used as a laxative; it has many uses. Mineral oil is also used as... well, oil, for some types of light machines. It's also used as coolant in electrical transformers. If you wipe it on metals before storage, it prevents rust from forming. You can clean with it too. Really it's great stuff. No, nobody is pulling your leg.

edit;
Just FYI, you're probably paying way too much for it if you buy it in small "for medicinal use" batches. A gallon jug of industrial grade mineral oil is like 15$ and should last you basically forever as a home user. I'm not aware of it having a shelf life.