as yoda said, the bad taste goes away after a few bowls. this is due to a 'cake' building up that prevents the wood from burning. even for tobacco, it takes several bowls to break the pipe in, which is known as, yep, you guessed it, a break in period... when you see 'pre-broken in' pipes, they normally take some thick confectioner's sugar syrup or honey or a watered down charcoal and rub it inside the bowl, which prevents the wood from burning... A good wood pipe spends a while quenching in an oil bath, which slows down the burning of the wood tremendously, and they are then placed into an oven. it's all about preparation.

I've made several wood pipes and love to smoke out of them. If they are made right, quenched properly, and adequately broken in, there is very, very little taste contamination due to the wood.