I didn't believe it while I was a JW. I practiced some yoga the whole time I was in the Watchtower. I even did the Sun Salute...OMG! My wife who is still a JW bought me a new yoga mat about a year ago so I don't think they all believe that way. When I left the Watchtower and went to a fundamentalist church I found some of the same fearful attitudes that a lot of JWs had to things like yoga. Crazy isn't a Watchtower exclusive.
I agree with what Skeeter1 said about it building more strength than weight training. I can go to the gym 3 or 4 days in a row and work out pretty hard and feel fine then go to a vigorous vinyasa yoga glass and find my stomach, arms, and legs all soar the next day.
How much emphasis is placed on the spiritual aspects of yoga can vary from instuctor to intructor and from class to class. My friend who instructs at the church I attend places a lot of emphasis on meditation and chanting other classes I've been to can are mostly just the physical aspects of yoga. As usually religious fear superstition can keep someone ignorant about something that is good for them and that they may really enjoy.