The functional programming guidelines I've seen (including, for example, Paul Graham's "On Lisp") have in effect said that if you need to mutate local variables you own, that's no big deal, as long as you can encapsulate that within one function. As far as consumers of that function are concerned, it is "pure," regardless of the fact that it uses mutation within its definition.

That much seems fairly obvious to me, but I'm somewhat new to functional programming. Is that all that is at stake here?