Sorry for the break.
When is hype bad? When it damages your image. Now don't confuse hype with buzz. Buzz is generally good because "you" don't do it. Buzz happens. Hype is manufactured.
Why am I being ambiguous? Because I'm talking about two different things. Right now you are assuming I'm talking about film distribution or something. But this also pertains to almost any event.
"I'm having a party. It's going to be the best." You are setting yourself up to fail. I've been to many parties and the best ones were never the hyped ones.
There is something about being pleasantly surprised with a situation. A movie, a party, a speech, an athletic event all are best being left alone. Sure tell us that something is going to happen but don't ever oversell it. Nothing is more disappointing then being let down.
So what can you take from this? Do you have a movie or event to put on. Create buzz not hype. Don't tell people this is a must see movie that will change their life, cause it won't. Hint, quietly at first, to the right people. Let the gossip factory do its job.
Buzz is started with a whisper in an ear to a friend.