On the plus side, the closest you fly to ground the better the resolution of Earth observation missions is. Moreover, very low Earth Orbits –VLEO– enable scientific mission as higher atmosphere studies and Earth’s gravitational field measurement. Finally, such orbits would open a brand new market niche for ultra-high speed telecommunication applications, IoT connections and more.
On the minus side, the drag associated with the residual atmosphere imposes severe limitations to the spacecraft, either in terms of on board propellant mass or in terms of mission duration.
As a matter of fact, under 250 km, drag needs to be continuously compensated with thrust, otherwise the spacecraft orbit rapidly decays.