The only problem with farming souls is that if you want to do any multiplayer it will get increasingly difficult to find people the higher your SL since you are paired with people +/- 10 of your SL. So you'll end up locking yourself out of a lot of pvp and co op opportunities. And if you do get into some pvp with someone your level that person will have vastly superior equipment because he'll likely be farther in the game than you putting you at a severe disadvantage.
This is why I only use farmed souls for buying spells and upgrading equipment. I use souls gained by traversing dungeons and beating bosses to level myself up, for the most part. I end up fudging it a bit every once in a while.
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