RAVEN,
your logic on the definition good and evil is fine, but your conclusion doesn't relate at all to how human beings, in this world, try to use the existence of evil to disprove God's existence, which is what this thread is about.
If you believed that this many people would argue that God didn't exist based on some tiny suffering in an otherwise perfect world, you are smoking crack.
Of course there would be the odd perfectionist or two in a billion who would say, "I stubbed my toe, see God doesn't exist", but he would be laughed out of town.
If you said that mostly-perfect-world people would be more responsive to smaller amounts of suffering, that seems to contradict all my experience - for example, when I am very healthy, I am less debilitated by some small ache, even if my mind notices it more; when I am happy, or in love or whatever, little problems bother me less, not more. Even if the argument would still exist, it would be brought up in a world so relatively chock-full of good things that most of us would be saying, "here is another reason to say a benevolent, omnipotent God exists: that's the twenty-third incredibly benevolent thing I've seen today."
Let's ask the question about THIS planet, why do things have to be so awful for there to be choices to make? The answer, it doesn't.
A free-will choice, between the supposed best and the not as good, is understood as the basis of, or at least the path to, christian salvation. Whether they are correct or not, many christians see members of some other religions and athiests as having chosen the "not as good". You aren't required to be "evil" to be excluded.
There is still a choice of God, or not-God, even if evil were not around. So again I ask, "why evil?"