I did not take a year off between things. I'm glad I didn't (see below), because I'll actually be starting my career by age 35. Some folks have to in order to get their applications together. I was fairly on top of things and front-loaded in undergrad, so application was set early and my last semester and summer before med school were easy and relaxing. From what I've seen, few people accomplish a lot their gap year, and they need to explain what they did. Many end up dinking around in a lab for little pay, with little accomplished at the end (ie no publication or even presentations). Others will do some bull**** job. The independently wealthy will travel (acceptable to adcoms but wasn't an option for me), and the WORST are the ones who sit at home on the couch (med school applicaiton is not a full-time job).
I DID take a year out during medical school training, however. I think going straight through undergrad-med school-residency without a break is tough. The big secret at some schools (like mine) is that your fourth year is a bit of a joke, and you can relax then. I took a year off because I did need a break (probably because I didn't between undergrad and med school). The big difference about taking a year off during med school is that most people, including many of my colleagues, accomplish a lot. We are better paid (med school fellowships are certainly better than undergrad ones), we get degrees in a year (MPHs, MBAs, MSs), or get competetive fellowship positions (at the NIH, or do career-builders like Doris Duke or Sarnoff), and actually accomplish things (ie publications). All will strengthen your residency application much more than some bull**** thing you do before med school (ie 4 years ago), which is uber important if you're thinking something like Derm or Rad Onc.
All in all, is taking a year off bad? Certainly no. Do it if you need to, but I'd recommend taking a year in medical school instead.