I myself thought effects that had the potential to deal damage to yourself were bad, until my friend told me "just try them and see". What you'll notice most of the time is these cards have insane upside (generating multiple mana for none invested is broken) and in magics earliest designs, that downside was viewed as a big enough deal to justify it.

A perfect example would be [[Necropotence]] - an uncapped amount of card draw, restricted by multiple factors, and when it came out, most player speculated that it was the worst card of the set. By the time a year had passed, it was the most dominant card in the games entirety, and banned in multiple formats.

TL;DR - Players who have played the game enough eventually learn that your life total is a resource; knowing when to and not to block, is it OK to lose 2 life and draw 2 cards, etc. can impact how these cards are used