If God exists, then there would be no evil in the world.
I think it would prove just the opposite, Everything has a dichtomy... day/night, dry/wet, happy/sad...good/evil. By that logic, in order for good to exist, there must be evil. If you had nothing to measure good against, how would one know what good is? If you were never sad, how would you know what it is like to be happy? If it never rained, how would you appreciate the warmth of the sun?
If you take the point of view that souls are reincarnated, then there has to be evil in order to keep things in balance. Reincarnation construes a need for a soul to be balanced in order to appreciate eternal bliss. If one never experiences all the dichotomies life has to offer, then how can one be truly balanced?
If you believe in Karma, then one must suffer for the wrongs that they have committed. If all you ever do is take and never give, then you have a debt that must be repaid. If you do bad, then bad will visit you. If you do good, then good will visit you. The only way you will know if it is good is to be able to measure it against the bad.
In modern religion, evil must exist in order to deter those that choose to walk the path of evil. If God truly wants us to reside in Heaven, then he must present us with choices that seems so repulsive and contrary to the nature of good that we naturally choose to be good.