I personally think that there should be some set, depending on design and wood and all, usually between 1 and 3 inches. On bows that draw nearly half their lenght, I'm absolutely easy with 2 inches of set. If you build a bow and it takes no set at all, something is wrong. Of course, a stave with 2 inches of relex that ends up straight has of course taken 2 inches of set.
Personally I think (with no prove on my side) that set is overestimatet. It's true that a reflexed bow has more energy stored, but you won't get that out until you unstring it. It certainly does not go into arrow flight. A lower brace will increase arrow energy, since ist's simply force * distance. What will also increase arrow energy is lighter bow limbs. And these will take some set.
I closely observe how a bow picks up set while tillering, because that way I know where the wood is working enough and where it isn't. I try to avoid set in the inner limbs, according to baker's suggestions, but mainly because extra wood in the inner limbs is more acceptable than further out. And yes, you CAN overbuild a bow by making it too wide and thin. Mass formula is excellent to get an idea, I use it on almost every bow I make, especially since I like using different woods.