In chapter 7 of her book Ratzinger’s Faith : The Theology of Pope Benedict XVI Rowland, Dean of Melbourne’s John Paul II Institute for Marriage and Family Studies says this:
"Another common disruption of the solemnity of the Mass is the sign of peace before Communion. At the time when this custom was introduced in its current form concern was expressed at very high levels about how it would operate in practise. It was suggested that in the case of a closed and educated community, such as in a seminary or convent, there would be no problem, but if several hundred or several thousand people are attending a Mass, and not arranged in an orderly manner, then it had potential to become ridiculous.** Ratzinger has suggested that the sign of peace would be better placed before the presentation of the gifts if it is to be retained at all, so as not to disrupt the contemplative preparation for the reception of Communion.* In Sacramentum Caritas, as Pope Benedict XVI, he pleaded for ‘greater restraint in this gesture which can become exaggerated and cause a certain distraction in the assembly before the reception of Communion’.***"
* A. Bugnini, The reform of the Liturgy, 1948-1957 (Collegeville, Minn.: Liturgical Press, 1990), 337
** Ratzinger, The Spirit of the Liturgy, (San Francisco: Ignatius Press, 2000), 170.
***Sacramentum caritas, (2007), para. 49.
Personally, I would love to see the custom of the sign of peace relocated in the liturgy to a point that would cause less distraction, like for example before the presentation of the gifts as suggested by then-Cardinal Ratzinger. This happens to good effect at Neocatechumate Way liturgies where, for good or bad, the sign of peace takes on a greater emphasis within the liturgy itself with a greater expression (which generally includes the entire congregation).
For now though, when attending the Mass in the Ordinary Form I generally bow reverently towards Our Lord in the Blessed Sacrament before exchanging the sign of peace with those around me. It does seem to be somewhat disjointed as this occurs right at the high point of the liturgy itself. For those of you who may ask I answered “I tolerate it” in Fr Z’s poll.