Rowling chose to make Slytherin the evil house because she thinks ambition is bad. That's one of the clearest themes in the books. She thinks people are naturally divided into good and bad, for the most part, with some outliers here and there, and Slytherin embodies all the traits she thinks is bad and Gryffindor all the ones she thinks is good.
First of all, Salazar Slytherin never claimed to hate muggles or muggle-borns, he just felt that the school should be kept within the wizarding community. This did not necessarily mean that he was prejudiced against muggles.
In conclusion, I have to wonder what would have happened had Harry not had his mind tarnished with the belief that Slytherin is bad. The sorting hat considered placing him in Slytherin but he begged it not to. If he wouldn't have had all these prejudices placed in his mind regarding Slytherin, would he have been placed in that house? I wonder what the alternate universe would have looked like? Would he and Draco still hate each other, or would they be friends? Would Harry be the seeker for the Slytherin quidditch team instead of the Gryffindor team? Would Snape still hate him?