Well it being used universally could be either a bad thing or a good thing, it could be a good thing because everyone has some standard or an agreement on what a mental disorder might look like. This makes it easier to talk about and identify on a consistent basis. On the other hand a negative side of using it universally is that the DSM doesn't consider cultural differences so we basically use our own standards to judge other people's behaviors that might only be different because of the culture their in, not because they actually have a mental disorder.
As for labels, well someone might not like getting called a schizo or bipolar. It makes people feel bad and it might also have negative impacts on things like finding a job or with medical issues like insurance.
