Certainly, human categories of good and bad are too simple and limited to apply to God. He is beyond human morality. In a larger way, and according to my church's interpretation, God is absolute good, because he is infinite love, which is good by definition.
One way I heard it explained by a priest is by a comparison with heat and cold. Some people see good and evil as two forces in the universe, maybe working together, maybe constantly in conflict with each other. But there is no such thing as cold; there is only the absence of heat. (I am not sure if this is scientifically true, but it works as an analogy.) Heat is the real thing; "cold" only means the absence of heat. Cold does not exist on its own.
In the same way, everything God creates is good. It can only be made "bad" by twisting it, misusing it, or perverting it from its original purpose. Even then, the thing itself is still good. Even things which are sometimes thrown into the "bad" category, like food and drink, sex, or just the material world, are good things, created by God and good like the rest of His creation, unless used in an "un-Godly" way. So, in this interpretation, a loving God does what is good for us, and we are free to accept the gift, reject it, or abuse it.
There is a conflict between my church and some Christian denominations over whether God punishes or turns away from people who do wrong. We do not believe that God ever punishes, or that He created Hell, so this results in a different perspective on God's actions and their justice or fairness. One of our theology books includes this discussion of the subject:
|God is good, dispassionate, and immutable. Now someone who thinks it reasonable and true to affirm that God does not change, may well ask how, in that case, it is possible to speak of God as rejoicing over those who are good and showing mercy to those who honor Him, and as turning away from the wicked and being angry with sinners. To this it must be answered that God neither rejoices nor grows angry, for to rejoice and to be offended are passions; nor is He won over by the gifts of those who honor Him, for that would mean He is swayed by pleasure. It is not right that the Divinity feel pleasure or displeasure from human conditions. He is good, and He only bestows blessings and never does harm, remaining always the same. We men, on the other hand, if we remain good through resembling God, are united to Him, but if we become evil through not resembling God, we are separated from Him. By living in holiness we cleave to God; but by becoming wicked we make Him our enemy. It is not that He grows angry with us in an arbitrary way, but it is our own sins that prevent God from shining within us and expose us to demons who torture us. And if through prayer and acts of compassion we gain release from our sins, this does not mean that we have won God over and made Him to change, but that through our actions and our turning to the Divinity, we have cured our wickedness and so once more have enjoyment of God's goodness. Thus to say that God turns away from the wicked is like saying that the sun hides itself from the blind.