I was planning on buying a touch screen like this one. I haven't got my raspberry pi yet so I would appreciate any advice about screens. The main thing I would like to know is can I use the gpio while the screen is attached. Has anyone using the screen had problems with it. Also, if I am just setting up the OS can I use that screen or do I need an HDMI or VGA screen. I will be using the Model B+.
I would like to know is can I use the gpio while the screen is attached
I think that will be a bit troublesome -- for starters unless you mod that case, there is no way to get anything out. If you did, you can see this this screen is compatible with the A/B because it only jacks onto the first 26 pins, leaving the rest open. However, that is pretty limited because they do not include the SPI, I2C, or serial buses, nor (more significantly) either 5 or 3.3 V power.
You can of course place wires under the connector; presumably this uses SPI or I2C but those buses can be shared between devices. However, that is a risky proposition unless you are very careful about it. A better idea would be to get a 40-pin cable + breakout, a breadboard and two 13-pin breakaway header strips. Then, when you want to do stuff with the gpios and have the screen attached, you could attach the screen to pins on the breadboard and share everything safely and easily.
The linked screen covers pins 1 - 26 so they will not be easily accessible even if they are not used by the screen. The listing you linked shows which pins are used by that screen.
You could use the gpios present on pins 27-40. Wherever they are sufficient for your needs depends on what you plan to do.
The linked screen (and similar) will not be recognized until you configure your system. So you will need a HDMI or composite (NOT VGA) screen for initial configuration.