Simon... I actually agree with you on some level. Here's why:
I don't believe in God as some old guy sat on a throne helping those he likes and smiting those he doesn't. Otherwise, I think we would see a hell of a lot more smiting, and a hell of a lot more nice old people. It just doesn't work that way. I see God as more of a force, a light, which we control more than we think, through faith and love. Through love anything is possible.
Now, that is just a starter for my viewpoint, now for why bad things happen... What is "bad"? Well, let's take an current example, these people that died in the quake. Why is this considered a "bad" event? Because lots of people died, and families lost loved ones, family and friends, homes, possessions. It is human nature to mourn and miss loved ones, even the most enlightened people would cry at a friend's funeral. But, in the long run, my belief is that life here is fleeting anyway.
Death is necessary. The world just isn't big enough to hold everyone forever. But death doesn't mean the end, it merely signifies the passing from one "realm" to the other, and (coming from someone who has experienced this passing briefly) it really isn't that bad after all. Again, sure, if my wife died, I would still mourn and cry and feel it is a tragedy, but deeper down, I know it is just a necessary step in our evolutions.
All in all, is death really so bad?
FMZ