Besides cost, a disadvantage of a big PS is that it creates more landfill waste, and a cheap high-wattage PS may also be inefficient, which is both an environmental and a monetary disadvantage. To be good to the earth and to your pocketbook, look for the 80PLUS designation, which means that it's relatively efficient and doesn't contain lead.
A high-wattage PS may or may not be a sign of high quality. On a cheapo machine, one of the things the manufacturer skimps on is the PS. The main issue you'll see with a cheap PS is that it may die sooner.
The PS has to be powerful enough to handle all loads experienced by the computer, not just the typical load that you'd measure with a meter such as a Kill-a-Watt. The maximum load tends to be at boot time, so if you use a PS that isn't powerful enough, you may experience unreliable booting.
References:
"Is there such a thing as "too much power"?" -- http://www.jonnyguru.com/modules.php?name=NDFAQs&op=FAQ_Question&ndfaq_id=3
continuous versus peak -- http://www.jonnyguru.com/modules.php?name=NDFAQs&op=FAQ_Question&ndfaq_id=5
80PLUS -- http://en.wikipedia.org/wiki/80_PLUS