Riding fixed isn't inherently worse for your knees than riding geared, it's being in an inappropriate gearing that will trash your knees. I run on the low side (70GI) and over the course of the past 12 months have learned to spin really fast comfortably so that I can easily outpace guys I ride with pushing 78-80GI set ups. The upside is that I never have knee pain because there is never a lot of stress on my knees and I'm quicker from a stop than just about anyone else. The downside is that if I ever get in a sprint pissing match with a roadie, a competent cyclist who actually trains will almost always be able to pull away from me.

For commuting and general riding purposes, I find this gear to be ideal and like I said, with training to learn how to spin you'[re easily as fast or faster than just about anyone short of the hardcore roadies you come across.