Sometimes what is "honest" is not accurate, so the first thing to think about when it comes to the importance, value and/or disadvantages of being honest is to recognize that there is "honest", then there's "objective/fair", and then there's also (again) "accurate".
It can be hard to tell the difference between someone who is being honest but believes the wrong thing, someone who is being honest but can't/won't overcome his own ego/interests enough to step outside of those things and get a more objective/fair/accurate picture of what one sees as "the truth", and someone who is just out-and-out lying for one reason or another.
Over the course of my adult life I've seen times when I would have done better to lie than to aim to present a fair, objective, accurate, and honest picture (complete with being careful not to include stuff I couldn't possibly know; but while kids often lie because they're only concerned about their own, little, individual, "picture"; grown-ups most often are part of a picture that involves people other than just themselves.
So, while there are situations in which lying (or presenting inaccuracy) may actually serve the individual and/or his interests/ego better than being honest (with others and/or himself) would; it can cause serious harm/damage to those with whom someone shares a "picture".
How honest and/or brutally honest someone should be generally depends on the situation, the issue, and the people involved; but there may be nothing more destructive than an inaccuracy (or lots of them) presented as "honest"(or worse, "brutally honest").
Grown-ups are supposed to be careful with what they allow to pass for the truth/facts about someone/something. Before they allow themselves to call something "true" they're supposed to step outside their ego, interests, and/or emotions and think like a judge, a reporter, and a scientist before deciding what is true about their individual picture.
If they do that they can place a good amount of confidence in what they see as "the truth", and if they truly care about someone/something other than just their own interests/ego then it will become clear that there shouldn't be room for inaccuracies that others (or life) can punch holes in and that will ultimately lead to one or another "whole picture" to become distorted and/or to fall apart.