Although I don't think that idling is great for the engine, it will save a turbocharger from coking the bearings.
@geordi: regardless of whether you do it all the time or not, extended idling in a diesel is generally bad for the engine.
#1 the fuel, although injected in small amounts into an oxygen rich environment, does not burn well. This causes wet stacking, fuel in the oil, etc. The reasons for the poor burn are several, but mainly because the combustion chamber walls are too cool to keep any fuel which makes it there from vaporising back into the chamber and burning. The atomization is also less than required for a full burn because the induction swirl is greatly decreased, the induction pressure is greatly reduced and the fuel injection pressure is only a fraction of what it is at load, all of which create a bad environment for a complete burn.
#2 idling causes a lot of soot buildup on the cylinder walls, rings, valves, etc. Abrasive soot is bad for metal parts.
#3 idling creates a lot of vibrational stress on the engine. This is bad for dampers, timing belts, alternator pulleys,etc.
The generator you referenced is NOT intended to run at idle for extended intervals. It's spec sheet indicates an operating RPM of 1800.
http://www.steadypower.com/catalog/prod ... 0&tb=specsX2 on the above. I have certainly seen problems as a result of wet stacking (unburnt fuel passing out the exhaust system). It can lead to clogged injectors, exhaust valves, turbos and exhaust components downstream. The raw fuel can also bypass piston rings and end up in the sump.
Having said all that this experience is based upon diesel gen sets running below roughly 40% load. We prefer to run them at 80% load.