drummerdudext,
you beat me to it. The “creation” of evil is not an issue as evil is not a thing, but rather a lack of a thing. It is interesting that Genesis gives an account where God creates Light, Heat (i am inferring this from the creation of light and suns/stars etc), Life. The non-things of Dark, Cold, and Death are not mentioned as being created. Perhaps there was some realization even in ancient times that these are non-things, i.e. not created things, but instead merely a lack of some created thing.
With regards to the free will defense though, I think the best one out there is in Alvin Plantinga’s God, Freedom, and Evil. Here is a short summary (read the full text to really understand his arguments as i will most likely do an unjustice to them). Plantinga here is arguing against Mackie’s claim that Set A is contradictory:
Set A:
(1) God is omnipotent.
(2) God is wholly good.
(3) Evil exists.
Mackie Argues that 1 and 2 cannot exist together with 3. He adds two propositions to help his argument:
(19) A good thing always eliminates evil as far as it can.
(20) There are no limits to what an omnipotent being can do.
Plantinga sees 20 as necessarily true so long as there are no nonlogical limits to what an omnipotent being can do.
Plantinga then goes onto 19 and says that 19 isn’t necessarily true. So he adds a few nuances and makes:
(19a) Every good thing always eliminates every evil that it knows about and can eliminate
Finding exceptions to this, Plantinga makes:
(19b) A good being eliminates every evil E that it knows about and that it can eliminate without either bringing about a greater evil or eliminating a good state of affairs that outweighs E.
This notion is then defined as “properly eliminating”.
With this definition, Plantinga accepts the necessity of the statement:
(19c) An omnipotent and omniscient good being eliminates every evil that it can properly eliminate.
The new set created, A’ is:
(1) God is omnipotent.
(2) God is wholly good.
(2’) God is omniscient.
(3) Evil exists.
(19c) An omnipotent and omniscient good being eliminates every evil that it can properly eliminate.
(20) There are no nonlogical limits to what an omnipotent being can do.
Plantinga argues that this set is not contradictory unless a new proposition (21) is added:
If God is omniscient and omnipotent, then God can properly eliminate every evil state of affairs.
However proposition 21 is not necessarily true, and thus Set A’ is not contradictory. Plantinga accepts the possibility that there is another proposition which is necessarily true and which combined with Set A’ makes it contradictory, but he has yet to find such a thing.
Plantinga then goes on to explaining why there is no contradiction within Set A’ itself. He attempts to defend the idea that since God desires his creations to be significantly free (free with respect to an action which would be either wrong to refrain from or wrong to do), then it is not possible that God could not have created a universe containing moral good without creating one that also contained moral evil.
First Plantinga argues that:
“A world containing creatures who are significantly free (and freely perform more good than evil actions) is more valuable, all else being equal, than a world containing no free creatures.” Thus, to create a more valuable world, God must create creatures who are significantly free. This means that to create creatures capable of moral good, they must also be capable of moral evil. Plantinga then goes into the concept of transworld depravity to the possibility that every essence could be inflicted with a transworld depravity which would mean that it “would always perform at least some wrong actions” [note: i am really mangling this part]
While I probably didn’t explain the argument very well, I encourage you to read the work (God, Freedom, and Evil) if you are interested in this question. Even atheistic philosophers have admitted that Plantinga argument has shown that it is not logically inconsistent to believe in a Omniscient, Omnipotent, All Good God and the presence of evil in the world. Of course this is not meant as a proof that there is a God or even meant to show that this is plausible, it is simply a refutation of the idea that the notion of the Christian God is inconsistent with the world as it is (i.e. containing evil).