I think it had both positive and negative effects. It began (or can be seen as part of a larger Protestant process) a slow decline in the power of the Vatican throughout Europe that led to a less centralised power structure.

However, it was also part of a larger problem within Protestantism, that is the proclivity to split into many smaller congregations 'fighting' amongst themselves (sometimes literally, but not usually). One positive thing that can be said about the Catholic church, even with all its many problems, is that they've 'stuck together' through centuries of turmoil. Like a family, you may not always agree or get along, but you stick together. Protestants never really got that.

As far as its effects on England, Joe certainly has a good point about kings versus Pontifs. Also, while it may have led to or helped foment democracy it did not lead to any greater religious tolerance. As an example see the treatment of the Puritans or the Hugenots. The 'state' wasn't too kind to those and many other groups.

And as for the 'why'? I think above all Henry wanted a son, and the Catholic church wasn't helping him out with that goal.

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