There are many standards and direction offered by the "search engines" in order to index and discover your page properly. The goal is not purely the appearance of the URL, which is what confuses flattening and optimization sometimes I think, but also to get your site ranked higher in results.
You should also be aware of the state management of your site given the dynamic value of the URL and the asynchronous state of the page as well. This solves your bookmarking and linking issues that a user might expect from an indexed URL from a search engine. If you page fails to recognized the state reload, you will find yourself disappointing your visitors.
The following are the reference links collected for the topic of search engine optimization, URL flattening, shortening, and any other terminology needed to describe the web URI:
- WebSphere Commerce SEO: URL Flattening Lite
- A List Apart: Articles: Slash Forward (Some URLs are Better Than Others)
- Improving search engine optimization for your WebSphere Commerce site
- Official Google Webmaster Central Blog: Dynamic URLs vs. static URLs
- URL Design — Warpspire
- Search engine optimization (SEO)
- Optimizing your site for search engines
- Apache Module mod_rewrite
- Tag: wcf:url
- Why URL Shortening is a Threat to the Web - Webmonkey
- War on Urchin! (Pinboard Blog)
- Hash URIs - W3C Blog
- My site isn't doing well in search
- Search Engine Optimization Starter Guide
- Sitemaps XML format
In general, be cautious to those that talk a big game about SEO. It likely means they know how to purchase keywords from search engines and tell you to make your URL look pretty, but they don't know how to do it themselves.
What you really want is organic growth in page visits from your site's technical implementation, while allowing the search engines to figure out your page structure and relevants on their own. You also want your HTML and meta tags to contain the proper organization that enable the search engines to do their jobs better as well.