It works great while you're on it just like any diet.
Lets see...you stop eating the stuff that makes you fat and sick. You lose weight. Then you go back to eating the stuff that made you sick and fat, and you are surprised you gain the weight back? That's not a problem with Atkins, that is a problem with your metabolism.
If you are over weight and respond really well to Atkins, there is a reason. Your bodies ability to regulate insulin and process sugars is MESSED UP. Going on a low carb diet allows you to work around that problem, but it does NOT change the underlying problem that your body can't handle carbs, starches and sugars.
As for Atkins being unhealthy, my only complaint with Atkins is their endorsement of soy products and canola oil. Other than that, you are following the way of eating the human body evolved to eat over millions of years. Processed flours, sugars, and frankenfoods like high fructose corn syrup and hydrogenated fats have only been in the food supply for a short period of time.
There is nothing unhealthy about eating red meat, fresh greens, berries and healthy fat. There is no such thing as an ESSENTIAL CARBOHYDRATE, yet a majority of the food people eat come from carbohydrates.
Most of the reasons people believe low carb diets are unhealthy are based on myths and outright lies. The entire concept that saturated fat causes heart disease and obesity is based on one terribly flawed study done in the 50's. Recent research has proven that saturated fat isn't unhealthy, isn't the cause of obesity (it is carbs and carbs combined with fat), but if you asked a room full of nutritionists and doctors, they would blame fat instead of wheat, rice, corn, potatoes, and high fructose corn syrup.
http://lowcarbdiets.about.com/od/lowcarb101/a/lowcarbmyths.htm
http://wifezillasway.blogspot.com/2007/11/stupid-things.html
If you (or members of your family) struggle with obesity, one of the best things you can do is get yourself a copy of "Good Calories Bad Calories" by Gary Taubes (it should be in your local library by now). His book traces the history of diet recommendations, tracks the science behind current dietary advice, and shows you just how messed up everything is.
Here are some links to get you started if you are curious...
http://crossfitnega.com/2008/02/10/good-calories-bad-calories-gary-taubes/
http://www.motherearthnews.com/Natural-Health/2008-10-01/Dietary-Fat-Health-Weight.aspx
http://query.nytimes.com/gst/fullpage.html?res=9F04E2D61F3EF934A35754C0A9649C8B63
http://nymag.com/news/sports/38001/
Here is a lecture Gary Taubes gave at Berkeley (free)
http://webcast.berkeley.edu/event_details.php?webcastid=21216
The reason I am so passionate about low carb is that I believe it saved me from years of lingering illness. Sure, the weight loss is nice, but I was at the point that I was due for a stroke. My bp was 149/95, and I have a family history of heart disease, type 2 diabetes, alzheimers, stroke, obesity, etc...
I had put on weight every year even though I was working out 1 hour a day 6 days a week, ate low fat, cut calories, and I still gained weight. I was also miserable, hungry all the time, and my blood pressure kept going higher and higher. I had 3 friends and a parent all get the type 2 dx within a couple of months, and I had all the same symptoms THEY had! I tried low carb out of total desperation. I have been at it for less than 2 years and already I have gone from having a bp of 149/95 to 101/62. I am down 42 lbs, and even when I don't lose weight, I still lose inches. I have more energy, I sleep better, I have fewer arthritis symptoms and carpal tunnel issues. I love the food and will eat this way for the rest of my life. Low carb is the smartest thing I ever did.