Yes, it was pretty routine when I was a student (Univ. of Liverpool, 1972-75, where much of the product was supplied in the students union coffee bard by one Nick Lightowler who turned up a few years later as Nicky Tesco, lead singer of a punk band called The Members.
I was a heavy smoker then and I did inhale, although I was never one of the heavy users. Actually I preferred to do what some of my non-smoking friends did, melt the resin in students union coffee. Not only did it give a quicker and more defined hit, it actually improved the foul SU coffee.
I have indulged very occasionally since, though the last time would be more than 20 years ago now. Whether it affected my mental health is open to question. I have had issues with severe depresssion but no sign of psychosis, I'm assured.