I believe that this is not an issue with Drupal 7 as it handles variables differently than D5/D6. However, if you want to make an install profiles for anything earlier than D7 static variables can pose a huge problem. Static varibles are used for caching within a function in PHP. Generally the first time the function is called during a page load the static will be set. The second time it's called there's no need to execute most of the code and the value stored in the static will be returned.
While statics can be convenient and help improve performance, they become a huge problem when the relevant data has been altered partway through a page load and you need to reset the cache. Since the install profile is executed in what's effectively a single page load, static variables become problematic.
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