If the master server hosted all the games itself, it would eliminate the need for port forwarding. However, it would probably also require a much more powerful server eventually depending on how busy it is... and then we may end up having to pay for it. Right now Planet MULE is free so by having each game hosted by one of the players, it's a big load off the server.
Many games offer the choice to host a local game or to choose a dedicated server.
Usually I play shooters, which means that most of the time a full single machine is dedicated to run a single game session, for 32 players for example. But as PlanetMULE doesn't stress the server as badly as an online shooter does, a PlanetMULE dedicated server could be setup to support <X> game sessions simultaneously, as it would be a waste of resources to dedicate a full server to run a single PlanetMULE game session.
I am sure some free, dedicated servers would emerge from this community. If dedicated server files were available, I'd install them on my dedicated Linux server immediately. Even if they don't offer enough slots for everyone on peak times, the option to host a local game could still be used as a fallback to ensure everyone can play for free at any time.
Dedicated servers not only get rid of the port forwarding problem, they're also great if you want to play against people on other continents. For example, you could host a server in London which could have quite good pings/connections to both Europe and to America.
There are a lot of other small advantages to dedicated servers, for example it cannot happen that the "host player" has connection problems and the whole game goes down. And thinking about auctions, the advantage of the host player can be avoided by using a dedicated server.
Also, if the master server was the only way to host a game, then if the master server ever went down, so would everyones games and nobody would be able to host again until it went back up. So its got pros and cons.
A single dedicated master server would have such drawbacks, but if everyone could setup his own dedicated server for free, there would be no problem. Also as I said above, local hosting could remain as a fallback.
The only real drawbacks I see with dedicated servers are the work for the developers to implement them and they would potentially lose some control over their game, people could modify the dedicated server files, etc.