Bonus shares are quite different to DRP - with the DRP you have paid for shares with your dividend, so there is no dilution.
Occasionally, a company may want to create more shares, and it has share splits. For instance, many, many years ago the BHP share department was worried that they were never breaking through the $5 mark, so they decided to halve the value of every share and issued a 2 for 1 (giving every share holder two shares of half value for the one that the shareholders had). Within a year they were over $10. Obviously this devalues the underlying price of the share.
Sometimes the company makes a big profit and they decide to spend it on bonus shares for all share holders rather than issuing a really big dividend. This should not devalue the underlying price of the share.
I don't think it is advisable to DRP for three reasons. The first is that you are paying an unknown price for the shares - obviously they will tend to be a lower price because they are ex-dividend and you have no brokerage, but they might be high. Secondly, if you have decided to have an investment split - say 10/80/10 between three investments, the DRP changes the allocation over time - you are not deliberately putting your money into the right investment to keep the balance. The third reason is that you end up with all these little parcels of shares to manage, and work out your CGT (when you eventually sell).