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The following extracts from John P. Meier, A Marginal Jew: III. Companions and Competitors (pp. 305-09) may be helpful as a summary of the current state of play with respect to using the traditions now found in the Mishnah and Talmud for research into the historical Jesus. Meier is discussing rabbinic literature as a source for the Pharisees in the time of Jesus. While this is one specific subset of issues, his discussion is relevant to the wider question of how NT scholars (and especially those engaged in historical Jesus research) use the rabbinic sources. [... are used to mark omissions.]
It was common among older Jewish scholars to rely heavily on the Mishna (ca. A.D. 200-220), the Tosepta (3d century), the Palestinian (or Jerusalem) Talmud (5th century), and the Babyloniaa Talmud (6th century) as well as the rabbinic midrashim from various centuries to reconstruct the historical Pharisees and Sadducees. More recently, Jewish scholars like Jacob Neusner and Shaye Cohen, as well as Christian scholars like E.P. Sanders and Anthony Saldarini, have urged greater caution in the use of rabbinic literature to delineate the very different conditions of Judaism in pre-70 Palestine.
The most obvious reason for caution is the problem of dating and attribution. Even the earliest rabbinic collection, the Mishna, was compiled almost 200 years after the time of Jesus. To be sure, various legal decisions and sayings in the Mishna are attributed to sages who lived before or roughly around the time of Jesus (e.g., Hillel and Shammai). But if we must be extremely cautious in accepting sayings attributed to Jesus in Mark or Q as actually coming from the historical Jesus -- even though Mark and Q were written down only a generation after Jesus' death -- we must a fortiori be cautious about presuming that sayings attributed to Hillel and Shammai actually come from them or their time period.
Then, too, there is the problem of knowing when the rabbinic documents are talking about the group that the NT and Josephus call "Pharisees" (Pharisaioi in Greek). The rabbinic writings speak at times of the perusim or perusin in Hebrew (the corresponding Aramaic form is perisayya'), but it is by no means always clear when or if perusin should be translated as "Pharisees." In itself, the word perusin could mean simply "separated ones" or "separatists." In various rabbinic contexts, the word seems to refer to excessively pious people, extreme ascetics, sectarians who have separated themselves from the mainstream of Judaism, or even "heretics."
In a few contexts, though, perusin seems to mean "Pharisees." This is especially true when perusin is contrasted in a legal debate with an antithetical group called sadduqim or sadduqin, most likely the Sadducees mentioned by the NT and Josephus. Since both the NT and Josephus present the Pharisees and Sadducees as antithetical groups, and since the Sadducees as a clearly defined group seem to have disappeared after A.D. 70, the rabbinic passages that present perusin and sadduqin locked in debate most probably preserve traditions that reach back to pre-70 Palestinian Judaism.
Even such a cautious approach has its problems, including problems of text criticism. Some later manuscripts of rabbinic works seem at times to have substituted references to sadduqin for the original word minim, "heretics," out of fear that Christian censors might take minim to refer to Jewish Christians. Hence one cannot always be sure that the opposition between perusin and sadduqin is original in the passage; without that opposition, perusin might simply mean "religious deviant."
An additional problem is that the Mishna, the earliest of the rabbinic collections, contains only one extended passage where the two groups are opposed to each other, thus making the meaning of "Pharisees" and "Sadducees" fairly certain. The key passage is m. Yad. 4:6-8 ...
[ ... Meier then discusses each of the these sayings -- 4:6, 4:7, and 4:8 -- in some detail ... ]
... In the end, one must admit that the yield from these rabbinic passages about the Pharisees in debate with the Sadducees is meager. Scholars naturally seek to find some other way to mine the rabbinic corpus, especially the Mishna, for further material that can be attributed with fair probability to the Pharisees. In the past, a common but uncritical route was to declare that "the sages" and/or "the scribes" mentioned in the rabbinic literature were identical with the Pharisees. The identification was sometimes not even argued; it was simply presupposed. Such an approach is rejected by many scholars today as begging the question or arguing in a circle.
Perhaps the most famous attempt to find a more critical way of sifting the rabbinic material for information about the Pharisees is that of Jacob Neusner. To provide a wider data base on the Pharisees, Neusner engaged in a massive three-volume project, The Rabbinic Traditions about the Pharisees before 70. This trilogy sought to excavate the earliest stratum of the Mishna along with scattered traditions from the later rabbinic corpus), a stratum that would have a good claim to go back to the pre-70 period. While his scholarship is admirable and his criteria exacting, critics have pointed out that one cannot presume that the pre-70 legal traditions preserved in the Mishna and other rabbinic writings are necessarily Pharisaic.
After all, the Pharisees were not the only Palestinian Jews before 70 who studied the Law and formulated individual rules for concrete behavior (halaka in the singular, halakot in the plural), as the Dead Sea scrolls and various OT pseudepigrapha show. In other words, not all pre-70 halaka abstracted from the rabbinic corpus by modern scholars has to be halaka unique to or especially characteristic of the Pharisees. ...
... In addition, it is more often presupposed than proved that the great pre-70 sages like Hillel and Shammai were in historical fact Pharisees. They may well have been, and many modern scholars have declared them so. But the historical arguments in favor of identifying them as Pharisees are tenuous. The best that can be said is that one may probably identify Gemaliel I and Simeon I as pre-70 Pharisees. In itself, the mere fact that m. 'Abot 1 puts these two at the end of a line of teachers who include the great pre-70 sages like Hillel and Shammai provides a thin basis for declaring the latter pair Pharisees. In general the tannaitic rabbis (up to the compilation of the Mishna ca. 200-220) were not terribly interested in maintaining that their predecessors were Pharisees. That claim becomes somewhat more prominent in the teaching of the amoraic rabbis (from the compilation of Mishna down to the compilation of the Babylonian Talmud). Were the early rabbis simply uninterested in post-biblical history? Or did they want to deny their origins in just one group among the many competing movements in the pre-70 period? Or were they just playing down their Pharisaic connections for the sake of defusing party strife and creating a grand coalition of diverse views? Or did the later rabbis emphasize connections with the Pharisees because they were intent on creating a "myth of origins" and continuity to bolster their authority? There may be some truth in all of these explanations.
In brief, then: one should be cautious about appealing to the earliest stratum of the Mishna and other rabbinic works as evidence for Pharisaic positions. This does not mean that rabbinic writings should be excluded as evidence for the pre-70 period. Rather, each claim must be tested on its own merits. If some legal opinion or practice found in rabbinic literature is said to be Pharisaic or, more generally, to go back to the pre-70 period, arguments in favor of that judgment should be given.