The dents are not great, but they are better than the alternative. If you don't have enough lube it can result in either a stuck case, or a case that is, in fact, stretched by extracting the case from the die.
I have always used the RCBS lube, and I find that if I coat the bottom of the tray with lube, then put the pad in allowing it to soak over night; by the next day, I can flip the pad over and roll cases on it, giving my the right amount of lube.
In saying that, it is more difficult to lube, size, or do any other reloading process on a 223, vs. say a 30-06. Because the case is smaller, ammounts and measurements become more critical.
Mike