"possibly discouraging repeat visits." --- you nailed it on the head yourself, that seems to outweigh any minor benefit from having one less field to fill out a

"possibly discouraging repeat visits." --- you nailed it on the head yourself, that seems to outweigh any minor benefit from having one less field to fill out at registration time. Even worse, if the password e-mail gets spam-filtered or even just delayed a bit, your user loses interest waiting around and just goes to another site which will give him instant access.