I think schools, particularly private schools, should be free to set their own policies, but personally I see the benefits of both.
On one hand, there is much to gain from a single-sex environment, as other posters have noted. On the other hand, it is quite poor preparation for the real-world, which obviously lacks sex-segregation.
I've found many co-ed private schools to have found a good middle-ground: co-educational teaching with single-sex houses. In my school, and many others, we had single-sex houses which served as a social respite tailored to each sex, but our lessons, and certain extra-curriculars (as was appropriate), were co-educational.
... and the ones that won't