If you release arrest records, people who are innocent have their reputations sullied.
If you don't release arrest records, it's easier for the police to do questionable things (particularly to the poor and otherwise disadvantaged) without it being visible to the media, public, and those that might seek to right these wrongs.
(Why so many arrests that don't lead to charges is interesting. People who prove innocent is one cause, and another is prosecutors only advancing really strong cases to maximize conviction rates is another. These are hard to tell apart.)
So, the right now when we publish arrest records we give police the tool to create some lasting harm to people without strong proof, but make it harder for them to capriciously arrest people or for prosecutors to abuse their discretion.