Dodgeball is a classic game that everyone associates "gym class" with. My dad played it (and got his face smashed in) and his dad played it (and smashed the germans faces in). I have had the opportunity to play classic dodgeball, as well as modified versions of the game and have come to some conclusions...
As the argument goes, the reasons why we shouldn't incorporate dodgeball in the classroom are that we would be using humans as targets, weaker players get hit first and sit the longest, and the more athletic kids get to flex their muscles (i.e. bullying). Not only that, but the rubber ball that was initially used stings like a bee.
In theory, dodgeball can help improve skills like throwing, catching, running, agility, and jumping. That is great for motor development, but what does that do for kids who haven't developed those skills in the first place? Are they really going to get better at certain skills if they get hit in the first minute of the game? No. They will sit on the sideline and begin to resent physical education. There are plenty of other games that don't cause psychological or physical harm that can teach these important skills. I think at the elementary level there are plenty of other games and activities that have a much better effect and help every student perfect their skills.
I do think that dodgeball is fun and that modified versions can eliminate the formerly listed problems. In class we talked about using a cone as a target to eliminate the use of human targets. Also, using gator skin balls (or any soft, throwable ball) takes away the pain factor. But with those changes, we can't really call it dodgeball anymore, can we?