There are a lot of misconceptions floating around about the .357 Magnum as a self-defense cartridge. First, the 125grn full-power Magnums are IMHO, overrated. While these rounds are definately very good, there are other loadings, IMHO, that are equally as good.
With regards to the flash and noise of the .357, I think alot of its vicious reputation comes from the afforementioned 125grn loadings. I prefer the heavier 140-158grn full power loadings for just this reason: the flash and noise are much more tolerable. Please note that I'm not talking about light or midrange loadings here but rather those which deliver a 140-158grn bullet at 1200-1300fps and generate in excess of 500 ft.lbs. of muzzle energy. I have personally fired a limited number (six rounds to be exact) of Cor-Bon 140grn JHP (published velocity of 1300fps) from a S&W M66 with a 2 1/2" barrel (short barrel typically accentuate flash and noise) in the dark without hearing protection so that I would know exactly how bad it was. While the flash and noise were certainly noticable, they were not disorenting (my night vision was unaffected and despite a ringing in my ears I could still hear what was going on around me). Understand that any handgun of decent caliber fired without hearing protection, particularly indoors, is going to be very loud and will probably cause some permanent hearing damage. I was also once present when a .44 Special was negligently discharged indoors. The .44 Special is often reccomended as having less flash and noise (the particular loading that was fired, a Fedral 200grn LSWCHP, is only rated for 870fps) but my ears rang just as much as they had with the .357 Magnum.
Overpenetration is another issue that often scares people away from the .357 Magnum for home-defense use. While the round is quite penetrative and certainly will go through interior walls, other handgun calibers do not eliminate this risk. Nearly any bullet that meets the FBI's 12-16" penetration standard (and most modern self-defense loadings do) has the potential to pass completely through an erect biped. Likewise the sheetrock interior walls of most homes aren't all that hard to pierce and can be penetrated with a .22 Long Rifle or birdshot-loaded shotgun. A relative of mine once had an accidental discharge (it was truly accidental as the firearm malfunctioned) with a shell of 16ga birdshot (#6 or #7 if memory serves). The pattern penetrated two interior walls and stopped in a third. Likewise, the ND with the .44 Special I mentioned earlier penetrated one interior wall the carpet and padding on the floor in the next room and skidded 6-8 inches across the concrete floor under the carpet before finally coming to rest. I think that perhaps the better solution to the overpenetration issue lies in tactics rather than caliber or ammunition. One should try to position themselves in their home in such a was as to minimize the risk to bystanders. Also, what to do in the event of a home invasion is a topic that should be discussed with everyone in your home (assuming they are old enough to understand of course).
The only real issue with using a .357 Magnum for self-defense is recoil. The cartridge does have substantial recoil in comparison to other common SD rounds like 9mm, .38 Special, .357 Sig, .40 S&W, and .45 ACP. However, an experienced shooter can still shoot a .357 Magnum both quickly and accurately. If you are new to magnum-caliber revolvers, I suggest you start with mild .38 Specials and work your way up by progressing to .38 +P, mild .357's like Winchester's 110grn JHP or Remington's Golden Saber, and then to full-power .357's going up in power only when you can shoot both quickly and accurately with what you're currently using. Using this method, I've found that most people, even children as young as 12-13 years old, can learn to handle the recoil of the .357 Magnum and even larger calibers like .41 and .44 Magnum.