It does not do to dwell on dreams and forget to live, remember that.
In Harry Potter and the Sorcerer’s Stone, Dumbledore keeps himself largely a mystery, particularly to Harry. When he finds Harry with the Mirror of Erised, he offers these words of caution without revealing what he himself sees in the mirror. Dumbledore is happy to be an enigma to his students, but he finds it vital to make sure they understand themselves. The wisdom he offers Harry is specific and personal enough that it either comes from Dumbledore’s own experience, or from watching someone else suffer from pining after a dream. He does not devalue what it means to Harry to see his family in the mirror, but he stops Harry from becoming lost in the past he can’t have.
“Mad?” said Percy airily. “[Dumbledore]’s a genius! Best wizard in the world! But he is a bit mad, yes.”
The students at Hogwarts have a somewhat removed perspective of Dumbledore. They get to see him from afar, but he is headmaster, not a regular professor, so they don’t get the chance to know him intimately. Consequently, the students’ impression of Dumbledore is based on his eccentric speeches and twinkling eyes. Percy’s assessment that Dumbledore is “a bit mad” probably comes mostly from these dramatic flourishes. However, Percy may also be repeating what he has heard from his parents. Many of the adults in Harry Potter treat Dumbledore with a sense of skeptical trust. If anyone else made the kinds of decisions Dumbledore does, they would not receive such a loyal following. No one but Dumbledore himself entirely understands his mind, but he has proven his skill and power to the Wizarding World and earned their trust and admiration.
Fear of a name increases fear of the thing itself.
Dumbledore is adamant that saying Voldemort’s name is a valid way of removing some of his power. Voldemort is powerful and dangerous, but the wizarding world fears him more than they need to because they refuse to even say his name. Dumbledore is especially stern when Harry calls Voldemort “You-Know-Who” because he knows Harry will continue to face Voldemort in the future. Dumbledore does not want Harry to develop the same fear the rest of the wizarding world has because he wants Harry to become someone genuinely capable of defeating Voldemort.