Should I Release Hacked Pokemon?

As long as you don't flaunt it online or use it in multi-player fights, you shouldn't have to worry about anything going wrong. You should probably store a box of any hacked Pokemon that you obtain as a kind of trophy case, where they may be seen but not handled. Always keep in mind that you must never, under any circumstances, participate in an online activity while using a Pokemon that seems to have been hacked.