Windows 7 > Git Bash > git init creates a .git folder that has the Hidden Attribute, but nothing inside it is given that Attribute. I prefer to remove that Attribute (I un-tick it in FreeCommander XE > Properties), so that I can easily look inside from Explorer (which I prefer to leave at its default setting of hiding hidden stuff). Is there any technical reason why I should not do this (ie leave that 'git folder hidden)?
To answer your question as written: No. Git doesn't care or know whether or not that folder is hidden.
It adds that attribute by default on Windows to match the default-hidden behavior on other operating systems. It's hidden because it contains things needed for the management of the Git repository which should be transparent to the user, and there are very few reasons for said user to go digging around in there.