A loop will save wear and tear on your string. It will also help to prevent the release from 'pinching' your knock off the the string at full draw. The loop can easily/cheaply replaced (see sticky tutorial by Greg/MO at top of this page). I also like the idea of holding and releasing the loop from directly behind the arrow instead of below or above on the string.

You will lose a fraction of an inch in draw length but not enough to change anything major.

With that said, there are a lot of succesful archers who shoot from the string (usually below the arrow nock).