Sans perfect world, as long as set ground rules are in place, any reasonable IT person should be ok with this request.
Ultimately, it's an issue of trade-offs: I guarantee that since you're allowed to go wild on your machine, the IT cost to support devs is higher. It's not right or wrong, simply a matter of trade-offs. It's up to an individual organization to determine an acceptable trade-off.
Edit: Grammar
I no longer support dev desktops, but I do admin the systems they use - servers, databases.
I'm cool with what you say in principle. If we're talking your own desktop, sure, no problem. As long as you're responsible for cleaning up your own mess.
But root on 'my' dev servers - no way, Jose. Those guys don't know unix, don't know what they're doing with root. They get shell accounts, they can do what they need to do.
Maybe it's the way we're setup. Typically 'the' box they're using is shared with other devs and applications. One fubared 'rm' as root and they've taken down great chunks of our development environment.
One problem with VMs is they would not work very well with the dev environments I support: JDE and ancillary applications.
In the scheme of things, I wonder which effect predominates.