You control prices of everything by influencing how much money itself is worth through controling how much money you "print" which you do by controling interest rates.

Economy has to be taken into account into how given level of interest rates influences inflation, but only as an input, never an output.

The utility of keeping inflation in check is immense because it provides stable environment for the economy so that everyone can pretty much treat price as a proxy for value. If the inflation does weird things you can no longer know how much your investment is worth or will be really worth in the future.

If you keep inflation in check it's fine if prices of some resources rise because it means their value increases. If price of pretty much everything goes up it's just a sign that you printed too much money, nothing more, nothing else.

When you are using money supply to stimulate economy, sometimes you'll get benefit, sometimes you'll mess up horribly. So the only thing you are really doing is introducing more instability into the system which harms everybody.