Does all religion cause physical or mental harm? I don't know. That's a tough question because to answer it we'd actually have to survey all of religion (and there are a lot of them out there - particularly when you realise that for the purpose of this question every sect must be looked at individually because what differentiates it from it's sister sects might make the difference in averting any harm that you may have found in those sister sects). One counter-example is enough.
Of course, the other way to treat the question is to look at whatever it is that makes something a religion and ask, "Is this thing necessarily harmful"? I don't know.
But I have to profess only mild interest in this question. Certainly there is good that comes from religion. I was listening to someone, I think it was a lecture by Douglas Adams that I downloaded the other day, talking about a similar point. Sure, the framework of not just religion, but a lot of old ideas (his example was feng shui) is false. Nevertheless, sometimes there is actual knowledge contained within it that's not worth throwing away. So, is it possible that some religions have some use? Sure.
However, one thing that I will unequivocally say is bad (not necessarily harmful, but bad nevertheless) is the idea of faith as a way of knowing something. It's simply false. The idea that because you believe it, it's valid or true, or whatever, and that there is no further evidence required, is wrong. And I think that leads not just to religious ideas (many of which are harmful) but also bad politics, bad policy, bad business, etc.
The idea that we can know something simply because we or someone else assert it, and that no further investigation is required, is not only false, it's arrogant. It does disservice to the beauty of the natural world, which requires real work to uncover.
