Good software engineering vs. Security
As usual, it's a tradeoff. Making your code harder to reverse-engineer/crack involves making it less readable and harder to maintain. You decide how far to go, based on your intended user base, your own skills in the area, time/cost, etc. This is not specific to Android. Watch this Google I/O presentation for various stages of obfuscating and making your code tamper resistant. Then decide how far you are willing to go for your own apps.
On the other hand, you don't have to obfuscate/harden, etc. all of your code, just the part that deals with licensing, etc. That is usually a very small part of the whole codebase and doesn't really need to change that often, so you could probably live with it being hard to follow/maintain, etc. Just keep some notes on how it works, so you remind yourself 2 years later :).
The counter productivity you are describing is the tip of the iceberg... No software is 100% bug-free on release, so what do you do when users start reporting problems?
How do you troubleshoot or debug field problems after you disabled logging, stack tracing and all kinds of other information that help reverse-engineers but also help the legitimate development team?
However tough the obfuscation methods are, there is always a way to reverse engineer them. I mean, if your software gets more popular among the hakers community, eventually someone will try to reverse-engineer it.
Obfuscation is just a method to make the process of reverse engineering tougher.
So is packing. I think many packing methods are available, but so is the process to reverse-engineer them.
You can check the www.tuts4you.com to see how tons of guides are being available.
I am not an expert like many others, but this is my experience in the process of learning reverse-engineering. Also recently I have seen a lot of guides for Android applications reverse-engineering. I have seen even in nullc0n (not sure) CTF, there was an app in Reversing Android. If you want, I can mention the site after searching.