I'm with you on that, think it would be a very bad idea! . Running PHP as CGi under suexec however does not do that, it merely allows the script to run with your privileges (as opposed to those of the webserver), which are somewhat less than those of a superuser in the DH environment.
This enhances security as there is no need to set permission to world readable or writable when running scripts, and that is a "Good Thing (tm)".
I'm hoping somebody has addressed your issue before - I have never looked into it myself, as I have never attempted to improve the quality of PHP error reporting. Maybe google will reveal how someone else has dealt with this?