In "Why I Write," Orwell says that this was his first attempt "in which I tried, with full consciousness of what I was doing, to fuse political o and artistic purpose into one whole." His aesthetic purpose--to write a book that would be praised as a work of art, attracting attention by its style and structure as much as by its content--was triumphantly vindicated by its publication success. He says elsewhere that he wanted in this book to destroy "the Soviet myth," but that does not mean he aspired to nor that the book requires a literal meaning of the allegory to understand its themes of power relationships, betrayal, and the power of language and the written word (for those who have power speak and write) in society. Language is corrupted by those in power (Squealer), and that is true in many societies, ours for example--not just in the Stalinist regime.
Both excellent answers. I think the disadvantages have been very well covered. I'd add these:
- By placing the story in fiction, he removes it from the political arena and allows readers to contemplate "what if" and draw their own conclusions
- This has elements of a puzzle, and potentially piques the interest of people who would normally ignore politics, thus reaching a larger audience.
- By placing a horrific turn of events within a fairy tale, Orwell draws a dark contrast between the ideal world and the reality (which is essentially his comment on communism--it offered an ideal world but turned dark)
- The theme of the story is as important as the historical significance: the potential for well intentioned idealistic people to become corrupt is relevant at all levels of society.
- As thaakar pointed out, the animal characters fit the people. Even outside of its political context, there are people who behave in predictable ways under pressure--like Boxer, who reacts to stress by putting his nose to the grindstone and working harder instead of actually doing anything to alter the circumstances that caused the stress.
This is an interesting question. One advantage might be by simplifying a rather complex period in history and making it appeal to a more general audience by presenting it in fairy tale form.
A disadvantage that I can see would be that you run the danger of simplifying the story. In essence what may be an advantage may also be a disadvantage.
Another advantage would be that by allegorizing the characters, you make them more memorable in the reader's mind.
A disadvantage to this approach would be that you it may not be apparent to the reader who the characters are to represent if they are not history scholars.
A final advantage might be that as a fictionalized tale, the 'warnings' of a totalitarian regime might be more heeded as the reader has become emotionally involved with the characters and has felt empathy for them.
A final disadvantage might be that many readers may miss the connection between Stalin and the events on Animal Farm. If a teacher were not there to tell them that this is based loosely on Stalin's reign, then many students will not know or understand Stalinism. You could not rely on Animal Farm alone to teach history.