The main reason why "playing with \parskip is a bad idea" is that this length also affects list environments. Quoting from Mittelbach (1989), With LateX into the Nineties, section 3.1 "Implementation desasters":
The generic list environment is one of
the central modules of the LaTeX
implementation. It is used internally
by most standard environments provided
by LaTeX; even environments such as
center are handled as a special kind
of list [...]
- An actual conceptual bug was the decision to add the value of
\parskip
to all vertical spacing parameters,
even when it is used in places where
no paragraph ends. This means that
changing this parameter influences the
layout in unexpected places, which in
turn means that other parameters must
be adjusted unnecessarily to
compensate for this undesired side
effect.
The last sentence describes what the parskip package, the options of the same name of the KOMA-script classes and the \abnormalparskip macro of the memoir class do: Besides setting \parskip to a positive value (and, with the exception of memoir, setting \parindent to zero), they adjust the spacing before and after lists.
Why does KOMA-scripthave so many options for parskip? You may choose between a vertical space equal to \baselineskip (full) or 0.5\baselineskip (half). You may also choose the minimum amount of whitespace to be left at the end of the last line of a paragraph (up to 0.33\linewidth); such whitespace increases the perceptibility of the start of a new paragraph.
Regarding \parindent: As Ulrike has explained, changing this length is not a problem.
\parskip(the vertical space between two paragraphs) is not wise (that's why the package is calledparskipand why KOMA has a lot ofparskipoptions). Changing\parindent(the horizontal space at the start of a paragraph) is not a problem. – Ulrike Fischer Mar 21 '11 at 14:15