One additional downside is that sprite atlases are annoying when you need to tile the image. Vertically repeating images can't be in the same atlas as horizonta

One additional downside is that sprite atlases are annoying when you need to tile the image. Vertically repeating images can't be in the same atlas as horizontally repeating ones. X+Y repeats each need to be in a separate image altogether. I'm also wondering if, to correctly emit the offsets in CSS attributes in all cases, you'll require some manually inserted placeholders.