In my experience, if one repository is down, then it is only that repository that doesn't refresh (yeah, the wording in the error message is confusing). I remember updating the package list once, and one of the repositories was down, but the update still worked because I was able to update GPE-Calendar (without disabling any of the repositories).

And I agree, the more repositories the are, the more complicated it is going to be to satisfy dependencies. We shouldn't have to rely on every repository providing all of the dependencies for every application it contains. This is why I think all packagers should be trying to get their packages into one of the official maemo.org repositories.