Is it a bad thing in academia if a student works from home? Missing department talks and seminars is obviously bad, but in case a student is pursuing a problem alone and he feels comfortable researching at home, is it viewed negatively? At times the time spent on travel and a crowded lab may disrupt one's flow of thoughts, so in those cases home provides an edge.
Is physical attendance deemed important by the department as long as they are kept in the loop regarding your progress?
Not necessarily. With the way that some departments are rapidly running out of physical real estate, they may even appreciate students who chose to work in their dormitories, homes, or libraries. (Of course, there is a barrier where one's work needs to be able to be performed at those locales, which of course rules out lab-based works in the experimental sciences.)
When I was a graduate student the department actually sent out an e-mail to all students asking students who intend to work mainly from somewhere apart from the department building to declare their intention so that they can more efficiently assign (the very limited) office spaces. But this was in a math department and eccentricity seems to be more tolerated there.