I agree completely that karate is a superb stress-reliever. As far as the physical side goes, I'd say it's a mixed bag.
It can be great for flexibility, though some "traditional" stretches can be seen on the "don't do this" list at your local gym. Also I think a lot of folk would agree it can be quite savage on certain joints (sore knees anyone?)
It can be quite a good aerobic workout, at least early on, but as technique improves I'd say it becomes less challenging in this respect (and should it even be aerobic in the first place?)
Deep stances ensure a regular workout for the leg muscles, but what about the upper body?
Then there's the addiction factor. Anybody trained "through" an injury or other ailment? Of course! But in terms of long term health, is that really wise?
All-in-all, I'd say if overall physical well-being is what you're after, then karate on its own isn't that hot - but then the same is probably true of most other physical pursuits...