The idea that atomic clocks are bad for audio does have some basis, but it depends heavily on where they are used. Because the short term accuracy (the area that is important for audio) of an atomic clock is pretty low comparatively (jitter is created while the clock tunes itself around the target frequency), it would generally be a bad idea to connect it directly to a DAC for example. It will essentially be a jittery signal, at least by high-end audio standards.
However, while the signal is jittery, in the long term it will be incredibly accurate as all the tuning around the target frequency will average out over time. So, feeding it into a second Master Clock with a quartz oscillator (which have inherently low levels of phase noise and jitter) provides this second Master Clock with a long-term stable reference to adjust to.
This of course depends on how the PLL in that second Master Clock has been designed - if it has a wide bandwidth (is fast acting) the jitter may well be passed on to the DAC. If it has a lower bandwidth PLL (slower acting) the jitter should be filtered out before it reaches the DAC, mitigating the issue. For reference, the PLLs in a dCS DAC or Clock are the latter, being slower acting.
So, are they bad for audio? Really depends on where in the chain they are used, and how the products it connects to use the clock signal.