Importance of default windows shares

Solution 1:

Per this article from the Microsoft Knowledge Base:

• DriveLetter$: This is a shared root partition or volume. Shared root partitions and volumes are displayed as the drive letter name appended with the dollar sign ($). For example, when drive letters C and D are shared, they are displayed as C$ and D$.
• ADMIN$: This is a resource that is used during remote administration of a computer.
• IPC$: This is a resource that shares the named pipes that you must have for communication between programs. This resource cannot be deleted.
• NETLOGON: This is a resource that is used on domain controllers.
• SYSVOL: This is a resource that is used on domain controllers.
• PRINT$: This is a resource that is used during the remote administration of printers.
• FAX$: This is a shared folder on a server that is used by fax clients during fax transmission. Note NETLOGON and SYSVOL are not hidden shares. Instead, these are special administrative shares

You can remove these shares live as per Roy's answer.

Note: Windows will automatically create the admin shares after a reboot. To prevent this behavior, use regedit to find the following key:

HKEY_LOCAL_MACHINE\SYSTEM\CurrentControlSet\Services\lanmanserver\parameters

Create the following 2 DWORD registry values:

AutoShareServer 0
AutoShareWks 0

Solution 2:

Look at this microsoft article:
How to create and delete hidden or administrative shares on client computers

To delete a hidden share, follow these steps:

In Control Panel, double-click Administrative Tools, and then double-click Computer Management.
Expand Shared Folders, and then click Shares.
In the Shared Folder column, right-click the share that you want to delete,
click Stop sharing, and then click OK.

Troubleshooting
Test the functionality of your programs and services after you disable the default administrative shares. Some Windows services depend on the existence of these shares.

EDIT: (Thanks Bork Blatt)
You need to edit registry to prevent shared drives from being re-created after you restart the computer.
wiki

Solution 3:

The only things I'm aware of it breaking are MS management software, like SMS and MOM. Even the howto KB above only gives a "microsoft recommends against", not terribly dire.