kfish,
I can only speak from my experience...and that would be that a SFE is reefsafe. He does "bump" into things, which can be a pain, and he does like to rearrange rocks to his liking, again a pain. However, he does not nible at the corals or anything.
As StacyT correctly stated though, they are large and messy eaters...so there is increased bioload, without a doubt. However it has not been a problem for me...the cleaning crew takes care of the mess, and I am just careful about water quality. IMHO, the eel is probably my favorite in my tank.
Stewart