http://www.youtube.com/watch?v=3LdlSAN1yks to amuse gear makers.

I forgot - the other reason for backlash (the extra distance) is to allow for the expansion of gears due to heating. This is not likely a problem for FRC, but in high-power gear boxes, particularly with oil lubrication, the gears heat and expand more than the gear-boxes. This would be especially bad for aluminum gears in a steel housing. The other case can also be true - if the gearbox is operated significantly below room temperature and the gear case is aluminum and the gears are steel, the distance between the bores in the case will decrease more than the pitch radii decrease.

The benefit to interference or zero clearance fits is that when the gear train reverses, there is no hysteresis between the input and the output. Some times anti-backlash gears are used with split spring-loaded gears to allow for tolerance without allowing backlash.

Otherwise, tight fits just load up the bearings and scrape up the gear tooth faces, while increasing the power losses in the drive train.