Why is this stopped? Is allowing it a bad idea?

Generally not a good idea. A player could be given sanctuary without the spell effect, so it'd never run out.

Yes. Basically, the affected_by bits are an internal tracker of state, rather than a normal game play mechanism. Messing with it directly is dangerous because you are bypassing the normal methods of altering it (adding spells, and so forth).

Well I think it was actually blocked as a security measure against players abusing bugs to gain access to mudprogs and then forcing those to issue commands to alter their stats, affected_by being among them.