The short answer on undersized cases is yes, it's a bad thing. If the case is significantly undersized, it will fire form to your chamber's dimensions. When resized, it will be undersized again. This will cause the brass to become work-hardened and will shorten the life of your brass considerably.
The SBD is not designed to grossly undersize the case. A full length die, when properly adjusted, still leaves the bottom part of the case (web and head) out of the sizer. A SBD will size down further toward the web and head of the case than a full length sizer. This work more of the case, and can lead to shorter brass life, and in worst case, a case head separation on weakend brass.
I have never had occasion to use anything other than full length sizers for AR's, or any other semi-auto weapon. In fact, I usually just neck size rifle cases for my bolt guns, and use the full size for loading virgin brass and AR brass.
Hope this helps.
p.s.--shit can the nickel cases!