ON topic...the biggest problem with denying people the right to multifaction, from my point of view, is that it results in RP animosity being taken OoRP.
As has been pointed out before, the Corsair/Outcast/Bounty Hunter relationships are very tense, because a lot of people have never experienced the other point of view.
The other major bonus in people having characters on both sides is that, when it comes to a fight, people can switch characters to make it even. However, with all forms of RP, one should never use OoRP knowledge to gain an advantage.
While I don't have any truly opposing characters (save for my Order and Bounty Hunter), I still find that working with those who I would otherwise be working against makes me respect them much more as people, rather than targets, and makes me much less inclined to get worked up over my loss in a fight.