It's not an approach without drawbacks or ethical grey areas, that's for sure. Going by the article that OP submitted my personal take on it is that the police made an acceptable trade-off in that instance. Had my child been abused by somebody involved in that forum in between the police's initial infiltration of it and closing it down I'm sure that my feelings would be very different.
That's an interesting case that you linked though, I'd be curious to read more details about it.
If police had not used the opportunity to collect evidence on many others before closing the site then the paedophiles would have just dispersed before reorganising somewhere else. In the long run I suspect that the total amount of child abuse material exchanged has been reduced.
I've never explicitly thought about the issue in utilitarian terms but it's given me something to think about.