Is freewheeling bad for your car?

Answer 1

In no way is it detrimental to a car, whereas overrun (when the wheels are driving the gearbox and engine) causes unnecessary wear on the transmission. Freewheeling will increase brake wear, but brakes are much easier and cheaper to replace than gearboxes and differentials.

Any vehicle that has to rely on engine braking, has an inadequate braking system.