This is a question without a simple answer. Religion did help mantain a lot of knowledge during the dark ages. Without the Catholic Church much of the scientific and intellectual knowledge of the previous two thousand years would of been lost. This knowledge was the foundation for the world we have today. At the same time the church supressed ideas that threatened its power, which is derived from god and their supposed access to him. Their idea of god is what made the Catholic Church the most powerful enity in the west for over a thousand years. They had a vested interested in suppressing any ideas that ran counter to their own. This certainly had a negative impact on the western world. When it comes to knowledge and sciencce religion has both hurt and helped to such varying degrees that I think its impossible to simple say it had a overall positive or negative effect.
Another argument thrown at religion is that it divides people and gives them a reason to see those outside their sect as less then and therefor subject to inhuman treatment. While true I believe this has less to do with religion and more to do with the nature of humans. People love institutions, religious or otherwise. They give power to them and that power is often used in horrible ways.
In the end it one of those hypothetical that I don't think has a compelling argument in either direction. Its also sort of a question without a purpose for me. Lets say we determine that the world would be better off without religion, then what? Religion will always exists. With that in mind shouldn't we move on to try and see how religions can coexist along side one another and along side nonbelievers? Its been done throughout history, its more then a mere fantasy unlike the idea of a world without religion.