To ease movement from development to production servers and overall flexibility, I found that it seems to work if I set my weblog path settings using the {homepage} global variable.

For example:
Section URL: {homepage}/news

Seems to be working so far, are there any pitfalls or issues using this?

Put the variable {homepage} in a template by itself, to make sure it displays what you expect.

In some cases, you might get http://www.example.com/

Yes I seem to be getting what I need.
My main concern is not having to update the path settings for each weblog if I change domain or index.php segment.

Hmmm…in my testing, its always giving me http://example.com/index.php, which is exactly what I need.

You’re saying there are cases that it would leave off the index.php segment (thus breaking my path settings)? Do you know what cases those are?

In some cases, I don’t have index.php as a part of my URL. I use an .htaccess file to remove index.php.

Oh right, I gotcha.

Yep- homepage may vary depending on your config settings- which sounds like what you want.  Glad Sue got you squared away.