Lugging is not "allegedly" bad, it is unquestionably hard on an engine. Going WOT from 1500rpm isn't going to cause the world to end, but doing it repeatedly just for fun is not doing your engine any favors.
Think about trying to accelerate from a slow speed on a 10-speed bike. What puts more load on your legs - doing it in 3rd gear, or shifting all the way up to 10th? In 10th you're pushing with all your might just to barely accelerate. In 3rd you lessen the stress on your legs, take advantage of the proper gearing, and accelerate more quickly. Same thing goes for the engine - being in the wrong gear puts more load on the rotating assembly for little to no gain.