Typically, a link would not be allowed to start or end in the middle of a word, so "Jane likes matches" could not sprout a link to "Kes Match", for instance. Special delimiters would need to be inserted into the sentence to create that link.
The chief disadvantages are complicating the creation of new pages, and the tendency for random links to sprout in the middle of text, making it much harder for the reader to distinguish signal from noise. From a performance perspective, DynamicLinkSyntax is difficult to scale, as the entire database must be involved in marking up a single page, but this does not make it impractical necessarily.
See also CommunityWiki:PlainLink.