The recursion will make it easier to wreak havoc, indeed. Some daemons will refuse working if their config is world writeable, so the change would probably be easily detected. But you don't necessarily need it. Remember, if you have write permissions to the directory, you can swap one file with another (with content of your choice). So if your/etc is world writeable your system's security is compromised, only in a more subtle way.
Slashdot Mirror
The recursion will make it easier to wreak havoc, indeed. Some daemons will refuse working if their config is world writeable, so the change would probably be easily detected. But you don't necessarily need it. Remember, if you have write permissions to the directory, you can swap one file with another (with content of your choice). So if your /etc is world writeable your system's security is compromised, only in a more subtle way.