Do you mean using a template to build your web pages? I hope it isn't bad but I would like to know the answer to your question too.
That depends of what kind of template you use, is my answer. As long as the template allows you follow the basic steps of SEO, I can't see why it should cause any limitations.
Yes, using templates to build web pages. I recently redesigned my site...changed it to template-based. After a few weeks, the # of my indexed pages in google dropped!! So i wonder if it's advisable to use templates when building a search engine friendly website.
A guess is that your new template changed the menu system. For example, many javascript menues arn't indexable (for GoogleBot) at all, which of course could make the number of indexed pages drop.
A menu that contains plain <a href>-links to the content of your website. Also, try to add a sitemap to your site.
It depends on how the template is built, however since usually building templates "the easy way" e.g. non SEO friendly, is the norm with templates, it is probably best to build your own, or hire someone who know how to make a template that is SEO friendly. I've seen a ton of templates that either use frames, horrible menu systems, non SEO friendly URL's etc.. i've also seen some that the designer did actually have SEO in mind, but best bet is to hire someone who will make it SEO friendly.
ill just briefly go over some of the comments above about menu systems.. the google bot can read many types of java menus.. for example my site globalsurance.com has a drop down java menu system. That is definatly viewable by google bot (i know this because g analytics sees all those links, if g analytics can see it, then surely google bot can). second straight text links arent neccesarily any better then images with alt and title tags. Those are fine. Just use text links when possible without damaging your site's design. Quite a bit is possible with CSS and you can do most of your menu without using images. Make sure your template uses h1->h4 tags and allows you to change the meta tags and titles on every page in the site. You can use virtually any menu system (even flash ones which are generally non-indexable though g does index flash to an extent) for your site, as long as you have a good sitemap at the bottom of your page, and submitted to google.
I hope this thread continues because I'm learning a lot from it. I'm currently using a template because I haven't yet learned html. I know I need to do that!