My main problem with it is the namespace ambiguity, especially with respect to plurality. For simple statements it’s fine, if you’re saying something about one person it’s going to be clear they are the one you refer to. If you’re talking about their relationship to a group though, unlike a singular pronoun it is no longer explicit that you refer to them but not them, for instance. You compensate for this by making sure your meaning is clear in other ways and it can be made to work, but the fact you have to put in extra effort to make up for “they”'s relative lack of structural utility is a serious problem with the word.

I still use it for lack of a better way to avoid implying knowledge/relevance of gender, but it would be nice if some overtly singular gender neutral pronoun like xe would catch on.