Idolatry does not find any support from Vedas. In chapter 32 of Yajurveda it has been said that God Supreme or Supreme Spirit has no ‘Pratima’ or material shape. He cannot be seen directly by anyone. His name is so great that only the Name is enough to invoke Him. He pervades all beings and all directions.
As God is formless and his name is enough, syllables comprising the words may, therefore, be taken as adequate representation. What God is like? The answer is, it is like the word ‘God’ containing the syllables G, O, D. The most striking example of this is the word ‘Om’ which means God in spiritual and material form. Thus according to the Vedas God neither has any image nor He resides in any particular idol or statue.
However we find that Hindu temples are filled with images or idols of gods and goddesses. This phenomenon can be easily understood if we try to know the necessity of assumptions. If we teach a child at nursery stage that ‘A’ stands for ‘apple’ we are making an assumption for easy learning of a letter of alphabet. While teaching geometry the teacher draws a triangle and says, "Let ABC be a triangle”. The word ‘let’ is used here because the lines forming the triangle are not really lines according to the definition of a line. A line, by definition, has length but no breadth. How to draw such a line on a blackboard? Breadth invariably accompanies length whenever one attempts to draw a line. Hence one has to use the word ‘let.’ One has to assume that what has been drawn is a line. Similarly, geometry asks us to assume a point also. A point is defined as having neither length, nor breadth nor thickness. It is without any dimension; still we try to draw it on a blackboard. What we draw is practically a circle, but it is assumed to be a point. A true triangle and a true point exist only in definitions. Yet we have to proceed on the assumption that they actually exist.
As the mind cannot concentrate itself on a formless being or spiritual form of Supreme Being one has to assume God in some visible object or image.
During the Vedic period there were neither temples nor images or idols of deities. So God was invoked through the fire kindled for havan materials. The seers of Upanishads discarded the practice of havans and concentrated on Imperishable ‘Om’. When the Buddhism and Jainism flourished in India the idols or statues of Gautam Buddha and Vardhaman Mahavir got much popularity. To rejuvenate Hinduism different images of God varied in shape according to different names of God came into existence. One may say that it resulted in spread of superstition in Hinduism.
Yet it is a fact that all temples, mosques, churches and other religious buildings are also idols and images where God does not come to reside. It is weakness of the man that he likes human shape. So majars (graves) of Sufi saints among Muslims and crucified figure of Jesus Christ in the churches command much reverence. In the same way personification of different names of God and giving different forms to them have helped sculptors to make statues or idols that may find place in temples to be adored by devotees
We can say that idolatry, in whatever form it may be, is based on assumption that God comes to a sacred place (building) or resides in a statue. There is no harm in going to temples or other places of worship. There is also no harm in saluting the image or images of God.
However it must be clear to every one that no temple or an idol kept there enjoys any supernatural power.
External form of worship will strengthen the idol only because we will be singing, describing the attributes of idol/creation and not Formless God. If we in the beginning are not able to judge the true, divine qualities of formless God then our love and faith will remain unstable. Such aspirant will only feel nearness to the idol and not formless God who is already within him and who already resides the nearest to the soul i.e., within the soul.
We will have to study the Vedas which state that idol worship is not permitted by God. Yet, if an aspirant wants to worship an idol then I am telling again and again that he can go at his own. I am giving answer based on Vedic philosophy only that what Vedas say about idol worship. Vedas do not speak about idol worship and avtarwad. However, people are free to go ahead on their own and do whatever they like.
When I will see any art which is liked by soul through eye, definitely it will be admired and the scene which is disliked will be ignored. So if many people admire the idol of Ganesh sitting on conch, admiration is natural.
So in the end I again say that he who wishes to worship idol, he may go ahead at his own. I have only told Vedas’ views on the matter of idol worship .
Source: http://various sources