Evaluating potential supervisors on the basis of past graduate student results
It's perfectly acceptable to ask a supervisor what their former students are doing now, and I think the majority of supervisors would be more than happy to discuss it. They might even give you email addresses of their old students -- I myself have been contacted many times by prospective students of my supervisor and am always happy to answer their questions. 

How much you factor the information you gain into your decision is really up to you, and depends a lot on your own motivations for doing a PhD and what you want to get out of it. For example, if you want to go into industry afterwards but a supervisor tells you that all of her former students are still in academia, would that influence you away from studying under her? Or if the majority of a supervisor's students are now in industry, how do you know whether they had to leave academia because they couldn't get a postdoc or because they really wanted an industry job instead?