Homeopathy is absolutely, unequivocably hogwash. Please read Ben Goldacre, or any other reputable evidence-based medicine expert.
There is a discussion to be had about the placebo effect, which is powerful. But dilution, impacting, "water memory" etc. is all complete woo.
Ben Goldacre's most recent book: http://www.amazon.com/Bad-Science-Quacks-Pharma-Flacks/dp/0865479186/
A video explaining the ridiculous theory of homeopathic dilution: http://www.youtube.com/watch?v=TZiLsFaEzog