I like Harry Potter but it's the potential for evil that has some worried.
What is wrong with Harry Potter is the same thing that is wrong with everything else in life, it can be used for evil or to promote evil. Without a foundation in right and wrong, without a foundation in God's word, someone might not understand that witchcraft is a very very serious evil.
Harry Potter portays those doing magic as some good and some evil. Someone who didn't know that God had strictly forbidden witchcraft, mediums, spiritists, and astrology could be encouraged to delve further into the occult.
When I was a kid I played the game "Dungeons and Dragons" and I still enjoy similar computer games. One day I was at a church and a guy was there preaching that Dungeons and Dragons was satanic. So I spoke up and explained that I had played this game as a Christian, and had not felt any warning from the Holy Spirit. I asked why he viewed it as Satanic.
He said, that the very nature of role playing games could be used to introduce people to demon worship. In dungeons and dragons you could choose a good or evil character to play. An evil player was not bounded only by his imagination. Therefore you could introduce a person to a lot of rituals and pagan ideas in the game.
So I could see his point, but I hardly thought that made the game evil. It's how the game is used. You could use a role playing game to introduce Christian concepts just as well. It's the lack of a good foundation in scripture that could allow the game to be a source of temptation.
Same thing with Harry Potter. If you know God is against witchcraft and that real power only comes from God. Then you are not in much danger and Harry Potter is just fun. It's those that are without that foundation that are put at risk by the glamorization of witchcraft.
We are letting our kids see Harry Potter, but we go over with them why God doesn't want them involved in witchcraft and the difference between imagination and reality. We figure they are going to run into stuff like this eventually anyway and we might as well use it as an opportunity to build that foundation they need.