Are Ninjas discouraged from muting users?
By muting users you hide content worthy of Ninja action.
EDIT: From a Ninja's POV, by muting users the Ninja can no longer see if that user has posted inappropriate content.
If a Ninja cannot see the inappropriate content, they won't know it is there and the action of warning/banning the user that posted the inappropriate content becomes a task for another Ninja/Superuser who has not muted that user or the Mute feature for basic users.
There's no policy against a ninja tailoring their own personal view of the forum. Even if a user is muted, ninjas can still see everything that has been reported.