I talked a while back about cutting weight for competition. I seeing articles written on cutting weight and hear fighters talking about it all the time. The belief is that if one drops weight to get to the top of a weight class, then he has an advantage. There have been many studies done on high school and college wrestlers cutting weight and there have been deaths from athletes doing this. I personally know a former top rated boxer who suffers now from cutting a lot of weight in preparation for fights.
Here's my take on cutting weight. If you have to lose more than 10 lbs (assuming you are already lean) fight at what you weigh. Now, for heavyweights it's a different because they carry more body fat. So, how much you can lose depends also on body fat percentage. Skinny guys dropping weight lose muscle and actually make themselves weaker. Most times, fighters drop a lot of weight fast (10 plus pounds in a day). The starve and dehydrate their bodies. This is bad on the organs and brain.
As a 160 lbs fighter, I could care less if my opponent's dropped 20-30lbs. I've never felt like, "Oh this guy who lost 15 lbs to fight me is so much stronger". I've worked out with smaller guys, who were actually stronger than me. Remember, there is going to always be somebody stronger, faster, etc. The philosophy is that all else being equal, the stronger athlete wins. But, in reality it never works out that way. Skill, will, mental toughness, and a lot of heart can determine that outcome of fight. So, believe in yourself and practice.