The danger with a congregational polity is that, sooner or later, someone will believe that this is the way things really are. And so the Church will be reduced both perspectively (where it is from where I sit) and existentially (where it is for me now).
The problem with this perspectival and existentialist (that is to say, congregationalist) undestanding of church is the same as the problem with saying that the blessed dead are dead to us and our concerns; namely, there is no sense in communion beyond ourself (which, eventually, must be reduced to "communion beyond myself"). In other words, to reduce the defintion of Church to "local congregation" is individualistic and isolationist. But worse yet, it does violence to the organic view of the Church as Christ's Body (St Paul) or as children of God (Old Testament).
A friend of mine has recently remarked that "[t]he genius of the Lutheran Confessions is to identify every congregation of baptized believers, even as small as two or three, gathered by the Holy Spirit around the office of Christ that preaches the Gospel of Christ and administers His Sacraments, as a genuine manifestation of the one, holy, catholic, and apostolic church in its fullness."
Now, certainly there is truth in this remark. For it is most certainly true that where two or three are gathered, there is Christ in the midst--and therefore, the whole Church on heaven and earth. We admit as much when we confess that the angels, archangels and all the company of heaven joining in our Sanctus, Sanctus, Sanctus. However, when one sees that there is truth in a remark, one must quickly ask, "Is that all? Is that the fullness of the Truth?"
Using St Paul's primordial definition as understood through St Ignatius et al., I would suggest that a full understanding of Church includes what might be termed a "trans-parochial communion." In other words, right-believing, right-worshipping congregations must be organically (and not simply noetically) in communion with all other right-believing, right-worshipping congregations. To do otherwise is schism. And for a right-believing, right-worshipping congregation to be in communion with heretical congregations (heretical, that is, whether in proclamation or in practice) is to be heterodox--"other than right-believing."
This "trans-parochial communion" has historically been defined as communion among the bishops who hold to the apostolic tradition. This tradition is not "custom" or "cultural baggage" but, as St Paul says, the prayed kerygma (lex orandi, lex credendi) of the apostles (see 2 Thes 2.15; 2 Thes 3.6); or, in a word, the Holy Spirit. For it is the Third Person of the Trinity who bound together the apostles, and their converts, in one fellowship united in the same faith and liturgy (Acts 2).
When we look at the Twelve on Pentecost Day, we see not twelve little congregations who happen to have the same thing. Rather, we see one Church which will shortly be diffused in twelve or more places. And they remain one Church precisely because they remain not noetically, but actually, organically and ontologically in communion. And that is how it should be--that we Christians are not simply knitted to the folks we see on Sundays at the place we've chosen as our safe-haven; but that we are knitted together into one body and communion in which all the saints participate in the divine nature. And that body is Christ. And His Body is the Church.