It wasn't so much the living away from home (we were overseas for 2 years when I was 10 years old) it was the return - the shocking disparity between how I now saw the world, and how my peers (who were frozen in time in my memory) saw things. It forever separated me from them in ways they could not understand.
In hindsight, it was one of the best things my parents did for me - compared to most of my home-grown peers, I adapted faster to new situations and had little difficulty adapting to life as an independent adult - in my opinion, thanks to the expanded perspective I gained when I was younger.
YMMV, but IMO, calling it "challenging for a child's social development" implies a negative, but it really depends on what your goals for that child's development are. It's certainly an experience I'd like to repeat for my own children if I can make it happen.