Tony, with ponds that don't have a lot of water inflow, or the possibility of a lot of water inflow, those types of ponds work fine.
But where a pond will see a considerable amount of water over an extended amount of time, I would be concerned that over time the spillway would erode and wash out the whole dam.
Most of the small cattle watering ponds built around here have nothing more than a wide spot at the end of the dam where water overflows out over grass into the pasture. Ponds are usually a ravine or wash that was dug out deeper using the dirt to build the dam. It is a quite common sight to see 20-30 year old ponds that are a couple feet low on water because over time some large rains have started an erosion path and cut a wash where the grassed overflow area used to be.
As long as the ponds have been maintained (such as putting rock riprap or some other erosion protection) in the overflow area they are ok. But if left to wash out over time, they end up lowering the pond. It usually happens over time because the overflow area is in original sodded area at the end of the dam instead of in the middle of the dam (where it would wash the whole dam out if erosion started), but it still happens.
In my old pond, I spread about ten ton of 3-4" lateral rock (for septic system drain fields) over the 12' wide overflow area. It is also now grassed within the rocks, and so far no erosion problems. So I think if done right and with the correct sizing, they work fine for intermittent water discharges. Probably would not be good at all for extended overflow periods like in a spring fed pond.
