Is running that bad for you and your knees when you have good running gear?

First off, you will be worse off at 40 = from LACK of exercise.

an jostle joints. That said with proper form and gear you should be ok granted you dont over do it. Many marathon runners for example have to cut back mileage as they get injusred over the years. If you will ever get seriously hurt involves too many factors such as your gait, your weight and also your footstike to name a few.

My advice is to start out moderate. 2-3 times a week running then maybe crosstrain another cardio form such as biking/swimming. Also don't contantly run on the same surface:vary it. Too much asphalt for aexample can cause problems in the LONG TERM. Always warm up and stretch.

DO NOT UNDERESTIMATE how much some moderate weight training will help. Even a couple times a week with your legs to help strengthen the weight bearing joints. Just a little more strength will help the knee capsule for example absorb more of the impact. Keep your core muscles like your lower back/abs/glutes etc strong. This will in the long run protesct you.
Read runner's world magazine or some thing to learn from.
Remember, moderate. You may want more later but ease into it and learn your body and it's limits.