Hi Katy,
After spending a good portion of my undergraduate time researching low residency programs (and am personally in the act of preparing applications for several as we "speak"), I am pleased to agree with the other posters here. The low residency programs may not be as well known, but at least in my field, they are full, rigorous programs of the same caliber as high residency settings. The MFA programs I'm applying to all have 60 credit hour structures, with intensive, year-round dedication, classes, and reviews--the same as any standard structure. In the visual arts they are designed for self-motivated students who are already working on a significant thesis or body of work.
The downsides I can see are really matters of personal choice. A student wanting a "traditional" education experience, on campus, will not receive it. On the other hand, a working student or student wishing to branch out from a local perspective into a more diverse, nationwide perspective would find it useful. You won't get TA-ships at some of the universities, however some do still offer the chance to be a TA or GSI, even with the low res format.
Basically, they are the same, full-blown graduate programs you would expect, only with specialized schedules. In most cases you work with a local professor as well.
Professors I work with and have spoken to across the board do not feel there is any type of stigma associated with these kinds of programs. Perhaps the general public may not understand, but universities and professionals are typically aware of what the format means, and that it does not mean "easy" or "abbreviated."
For what it's worth! :-)
Here are a few schools that offer low res programs in the visual arts (in addition to those named above):
Maine College of Art and Design
Vermont College of Fine Arts
San Francisco Art Institute
MASS Art
Goddard College
Burlington College
Johnson State College
New York University
New programs are being added all the time, too!