EDIT: @Odlov, I see your point, I really am not as smart as to come up with a conclusion to disprove your idea, I really have to think about that, it is a very good premise. I will have to look into that, and as so, let's not go into the depths of the arguement of this subject cus to conclude that would take decades,good game, let's get back on the topic of "Everything Happens for a Reason".
2: Yes, that is very true, it is bad for the one doing the action, but it does not show anything about the one allowing that action. If you are to say that "God is bad because He allows us do to bad things" think of it this way: When our parents let us fail, is that bad? It allows us to learn from our failures, to see how if feels to do bad and to do good, and to learn and be allowed to show our true morals.